Pennsylvania Cracks Down on Online Cash Payday Loans Companies

Pennsylvania residents may have trouble getting cash payday loans online after a recent court ruling. On Wednesday, a Commonwealth Court ruled that online payday lenders based in other states were still subject to Pennsylvania lending laws.

Specifically, Cash America International, a payday lender headquartered in Texas, cannot issue loans to Pennsylvania residents until it obtains a license to do so. This license would limit payday lenders to charging no more than 24% interest annually.

The court was ruling on a decision by the Pennsylvania Department of Banking to force lenders like Cash America to obtain licenses before lending in the state of Pennsylvania. Cash America plans to appeal the decision.

Currently, Cash America charges fees of about 25% on payday loans. These fees can add up to as much as 1,141% interest yearly according to the court.