The leading lobby for payday lenders said it would require its members to follow local laws and be licensed in each state where they issue loans through the Internet.
The Community Financial Services Association, which represents major payday lenders including Dollar Financial Corp., said its members could risk losing their membership for violating the new "Internet lending best practice" requirement.
In a press release issued Tuesday, Darrin Andersen, the president of the Washington trade group, said that "customers who choose to get a payday advance online should not forfeit any of the protections they would have at a storefront lender."
In February the trade group announced a $10 million financial literacy campaign and policies to defer late payments. The campaign is aimed at helping its members gain market share and at easing the concerns of fair-lending proponents, the group said.
Also Tuesday, the Austin payday lender EZCORP Inc. said it was beefing up efforts to protect consumer data through branch audits, better employee training, and "paperless" technology, among other things. The new measures were announced the same day Texas Attorney General Greg Abbott said he was suing EZCORP for exposing its customers to data fraud.
Mr. Abbott said EZCORP dumped consumer data including Social Security numbers and bank account statements in "easily accessible" trash cans at several San Antonio locations.
The trade group said EZCORP was a member but that the announcement of its own online best practices rule was unrelated to the case against the company.
