Summary

Payday Loans in Texas have sidestepped the existing regulatory structure in Texas by using the Credit Service Organization (CSO) Loophole, originally designed for credit counseling and repair services.

Consumer advocates monitoring the financial services industry in Texas are lobbying for closure of this loophole and the establishment of a system to monitor the volume and characteristics of payday loans in Texas. They also suggest that Texas adopt protections for borrowers who are in the active military which mirror federal protections federal lending protections for those borrowers./1/

References and Resources

/1/ Center for Public Policy Priorities Policy Paper on Texas Payday Lending
Center for Responsible Lending homepage