Colorado Settlement Sets Rate Limits for Bank-Fintech Loans (1)

Aug. 18, 2020, 8:15 PM; Updated: Aug. 18, 2020, 10:13 PM

Colorado has reached a settlement with four lenders that establishes a framework for bank-fintech partnerships to operate legally in the state with consumer protections against high-interest loans.

The settlement filed Tuesday with online lenders Avant LLC and Marlette Funding and their bank partners, WebBank Inc. and Cross River, resolves allegations that their lending arrangements violated state usury limits.

The state alleged in 2017 that Avant and Marlette were the “true lenders” of loans made to Colorado consumers. The fintech lenders skirted the state’s usury limits through their partnerships with out-of-state banks, which are allowed to issue loans at higher interest...

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