On October 1, 2025, Nevada Senate Bill 437 takes effect, which will amend the Nevada Installment Loan and Finance Act ("ILFA") to significantly streamline licensing and operational requirements for consumer lenders that engage in business exclusively through the internet—most notably, the requirement for companies applying for an Installment Loan Company license to maintain a "brick and mortar" office in Nevada.
The IFLA requires a license to engage in the "business of lending" in Nevada of any dollar amount, and includes both commercial- and consumer-purpose loans within its coverage. Unlike nearly all other states' laws that license and regulate non-real estate secured lending, the ILFA requires consumer lenders seeking to obtain a license to operate from an out-of-state location to also maintain a licensed office in Nevada as a condition of applying for and obtaining a company license. The Nevada Financial Institutions Division ("Division") strictly interprets the in-state office requirement; the Division requires the licensed office to be (i) open to the public during normal business hours on Mondays through Fridays; (ii) staffed by at least one employee of the company that is trained and knowledgeable on the company's products and services; and (iii) have adequate signage to allow customers and regulators the ability to locate the office. Even maintaining a co-working or shared office space is not sufficient to satisfy the in-state office requirement. As a result, the in-state office requirement can be a material impediment to some internet-based lenders' abilities to obtain the ILFA license.
While the Nevada legislature amended the ILFA in 2020 to create an exemption from the in-state office requirement for an "Internet business lender" that makes commercial loans solely through the Internet, the legislature did not create a similar exemption for internet-based lenders that also originated, or exclusively originated, consumer loans. Senate Bill 437, which was approved by Governor Joe Lombardo on May 28, 2025, adds the term "Internet consumer lender" as a defined term to the ILFA. The bill defines an "Internet consumer lender" as a person who makes, solicits, brokers, arranges, or facilitates consumer loans exclusively through the internet. The bill permits an Internet consumer lender to apply for a license for a place of business located outside of Nevada even without any licensed location in the state, exempting Internet consumer lenders from the ILFA's in-state brick-and-mortar office requirement.
The bill also exempts Internet consumer lenders from the ILFA's prohibition on licensees engaging in the business of making loans within any office or place of business in which any other business is solicited or engaged, unless the licensee has received approval from the Division to conduct the separate non-lending business. Previously, the ILFA only exempted Internet business lenders from the "other business" prohibition. The exemptions implemented by Senate Bill 437 should offer an opportunity for new consumer lenders to (virtually) enter the state and obtain licenses under the ILFA.
Last, Senate Bill 437 implements a new requirement that any contract between an Internet consumer lender and a resident of Nevada for the provision of a loan (i) provide that the contract is governed by the laws of Nevada, and (ii) require that any litigation, arbitration, or other process for the resolution of disputes arising out of the contract occur in Nevada, in each case to the extent not preempted by federal law. Any provision in such a contract that conflicts with this requirement is void and unenforceable.
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