Minnesota Acts to Nullify Payday Loans from Lawbreaking Lender

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Posted by Eileen Stewart July 20, 2024
Minnesota Acts to Nullify Payday Loans from Lawbreaking Lender
Image By: Minnesota Reformer

Payday loans issued by a business that disregarded state lending regulations have been canceled, according to the Minnesota Department of Commerce.

The decision has an impact on Minnesotans who have taken out short-term consumer loans from Strategic Solution Services, Inc., which is also the name of Arrow Mountain Funding and Line of Credit Now.

According to the Department of Commerce, Strategic Solution Services did not respond to its demands for information about loans given to Minnesotan consumers and did not have a license to offer loans in the state. State representatives claim they are unaware of the number of loans given to Minnesotans as a result of that rejection.

“We want all Minnesota consumers who took payday loans from this unlicensed company to be aware of this action by the Department,” Commerce Assistant Commissioner of Enforcement Jacqueline Olson stated. “Commerce remains committed to protecting consumers from unscrupulous lenders.”

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Payday loans are high-interest, short-term loans that are primarily taken out by customers who do not have access to traditional credit options, according to commerce officials.

The consumer protections included in the 2023 updates to Minnesota’s payday lending regulations included a maximum cap of 50% APR (annual percentage rate) on loan costs and fees.

According to state investigators, a customer borrowed $500 on a payday loan from Strategic Solution Services, with a total of $1,682.82 paid back over the course of 12 payments. It is said that the lender accomplished this by taking money out of the customer’s paycheck.

Following the customer’s withdrawal of authorization for Strategic Solution Services to initiate automated deductions, the business sent a “Demand Order” to the customer’s employer, asserting that the customer was still in debt for more than $2,000 related to the $500 payday loan.

The Commerce Actions and Regulatory Documents, or CARDS, database has the whole order that the Minnesota Department of Commerce issued.

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Eileen Stewart
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With more than two years of expertise in news and analysis, Eileen Stewart is a seasoned reporter. Eileen is a respected voice in this field, well-known for her sharp reporting and insightful analysis. Her writing covers a wide range of subjects, from politics to culture and more.