Payday lending in California is legal and there are laws which safeguard the borrower’s interest and prevent them from predatory lending. California Payday Loans up to $50 should not be charge a fee more than $5.

Under California law, the lender's fee cannot exceed 15% percent of the loan amount and the total face value of the check may not be more than $300. The lender agrees to hold the check until the customer's next payday, up to 30 days. Borrower may redeem the check with cash.

California Payday Loans companies are required to be licensed by Department of Corporations (DOC) under the California Deferred Deposit Transaction Law.

The payday lending business is on the rise in California. As of 2003 there were more than 3,000 Payday Lenders in the state. The Payday Lending industry is expanding nationwide exponentially, and California is no exception to the rule.