Thousands of payday loan lenders from practically all the States of America are engaged in this industry. The payday lending business have been developing and prospering for almost 20 years and have been facing a growth in the number of loans and increase in profits during all these years. But this prosperous development may come to an end due to the recent changes in lending industry, particularly due to the intense governmental regulation of the business.

The payday lending industry has been always controlled by the State laws and regulations. The State governors could establish levels of annual percentage rates, maximum fees that lenders receive from their customers, acceptable extensions and rollovers of loans, etc. In the recent 10 years some States prohibit the outright pay loans, other States set miserable finance charges for the customers. Because of these measures no payday loan lender can successfully work on the market and receive high profit. Although the number of customers interested in getting payday loans is increasing, the lending industry is losing its strong position. Many lenders can hardly survive in the industry and even seem to go out of the business soon.

Small payday loan lenders are affected differently than the big lending companies by the regulation changes. Large lenders can still operate successfully and receive high profits, if they are strongly regulated at the State level or even if the lending operations are completely banned in the State. If a company has only one lending store in the State and is forbidden to give loans to the customers, it can no longer operate. But if the company has a lot of stores and a couple of online websites throughout the whole country, it can still stay in business, even if some of its’ stores will be closed.

A lot of payday lenders are trying to adapt to these changes to run the business successfully in future. E.g., the largest American online payday lender Cash USA is going to change its’ policy by creating affiliate marketing, which will bring less profit, but at the same time less risk and no licensing at all. Some other lending companies are trying to substitute payday loans for installment loans. These 2 types of loans are practically the same, but the latter are given for larger sums of money and for a longer period of time. Usually the term makes up 6 months.

Today nobody can definitely predict what will happen to the payday lending industry in future. As for now, the officials, who adopted regulation acts, don’t pay much attention that there is a high demand for payday loans from the borrowers. They also don’t try to think up some other types of short-pay loans that can be offered to the population instead of payday loans. While it is happening, the payday lending business will do everything possible to adjust to the new regulation and profitably operate on the market.

The establishment of the Bureau caused a wide reaction from American mass media and press. Everybody is making assumptions how the BCFP will effect payday lending business. Although there are a lot of various opinions on this issue, the most journalists share the opinion that the new agency will badly hit the payday lenders, who experienced a significant government regulation in the last 10 years.

Attorney Hilary B. Miller has lately written an article in blog of payday loan lenders, in which he tries to foresee which consequences the lending industry will face and which further legal acts, restraining lenders’ activities, will be implemented.

In spite of the fact that the most of mass media’s representatives are quite sure of the lowering of leading positions of payday lending sector, Mr. Miller holds another point of view and doesn’t hurry to bury the payday lenders because of establishing BCFP.

Although the Dodd-Frank Bill consists of 848 pages, it does not contain a real regulation of cash advance and loan lending industry in Mr. Miller’s opinion. On the other hand, he pays large attention to the “Title X”, which greatly regulates the activities of payday loan lenders. So Mr. Miller concludes that Title X has a bigger constraining influence on lenders that all the other specific regulations of the Bill.

Mr. Miller assumes that members of the BCFP are sensible and reasonable people. They are used to make decisions on the basis of science and conducted research, rather for their own interest and benefits. They are not interested in getting votes and hold the chief positions in the Government. If Mr. Miller is not mistaken about them, these Staff Members will resist the members of the Center for Responsible Lending reports, who only try to make up those ideas that describe payday loan lenders in a negative way.

If Attorney Miller is right in his statements, payday lenders may face favorable changes in future. Today almost all of the regulations concern the level of annual percentage rates and fees on payday loans. In establishing level of these indicators officials usually falsify actual data. In their statements they tend to repeat the same words, like payday lending companies are aimed at the families with low income. But they will never accept the fact that they are not right. If officials decrease percentage rates to 36%, they would force payday lenders to go out of the business.

If Mr. Miller’s arguments become a reality, it will be beneficial both to consumers of financial services, who will have freedom to choose and to payday lending businesses, that will have freedom of operation. As for now the BCFP is establishing and extending its rule over most of the financial sector of the USA.