Confirm the information with your state regulator or attorney general to learn whether a payday lender is licensed to do business in your state. Many states don't allow payday lending, and some states that do allow payday lending require lenders to be licensed. In some states, if a payday loan is made by a business that isn't licensed in your state, the payday loan may be invalidated. If this happens, the lender may not be able to collect or require you to repay your payday loan.