HOW PROFITABLE IS A CONSUMER LOAN BUSINESS?
It depends! (You’re not surprised, are you?)
- First, are you offering payday loans? Installment Loans? Title Loans? B2C?
- You’re funding customers online?
- You’re using the storefront lending model?
- A blended loan model? Both store[s] & the Internet?
- You’re using a State licensing model? If so, your State regulatory authority – typically the Department of Financial Institutions – will determine what fees you can legally charge.
- You’re using the tribal model? You can create one loan product and offer it in any State you choose. [Get legal advice or reach out to us to explore. Tribal Lending]
- Your underwriting vendor
- Your payment processing vendor?
- Your text messaging provider.
- Your LMS [Loan Management Software] provider
- And dozens of other expenses. Just like any other business.
Here are a few examples of the legal loan rates and APR’s in addition to profit metrics based on licensing scenarios for a few states: CLICK: READ MORE
