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With the popularity of payday loans in the UK and the US, Indian tribes are looking to expand into the market because of its rise in profits during a global downturn. AMG At least a dozen payday lenders doing business with AMG Capital Services are run by Indian tribes. Because of their sovereign immunity, Indian tribes are not subject to interest rate caps and other payday loan regulations. The lack-of regulations are making partnerships with Indian tribes very popular in the payday loan industry. Just like the casino industry 25 years ago, the payday loan industry is becoming extremely popular for cash-strapped Indian tribes. Colorado Attorney General John Suthers has stated that the states are powerless to stop both the tribes and the companies teaming up with them. South Dakota An effort in South Dakota recently failed to try and cap these payday lenders. One bill would have capped the yearly interest rates at 36 percent and the other bill would have raised the licensing fee from $1,500 to $5,000. Both bills failed because many people need these services. In cases of Indian tribes, however, they don’t run the payday loan companies themselves. Instead an existing lender sets-up their company on an Indian reservation and share the revenue with that tribe to take advantage of their sovereign status. What many are worried about is the legality of such practices. What if credit card companies decide to do the same thing? How will the US government regulate interest rate caps if they are powerless to do so. They will then not be able to protect the American citizen from predatory rates and fees. For now, at least according to Suthers, it looks like the US government is powerless to regulate interest rates and payday loans on sovereign land, however this may change as more and more customers see their debt spiral out of control. Bills in Texas and South Dakota have tried unsuccessfully to protect the cash-strapped consumer, but for now, it looks like customers will have to be very clear on what they need and what risks are involved when taking out a payday loan. Mark loves helping people out of tight financial situations. If you find yourself in need of a little quick cash, Mark suggests using payday loans UK.
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