Active-duty service members and their spouses and dependents who borrowed from CashNetUSA may be covered by a proposed class action alleging the online lender’s loans cost 222% to 579% a year, far above the Military Lending Act’s 36% cap, and are void as a result. No class has been certified and there is nothing to file yet.
Allegations Only · No Settlement Yet
This article describes a class action complaint. The statements below are unproven allegations. CashNetUSA, Enova International and the affiliated companies have not been found liable, there is no certified class, and nothing to claim at this time. This page is informational and is not legal advice.
What Is the CashNetUSA Lawsuit About?
CashNetUSA is an online lender owned by Chicago-based Enova International, Inc. It offers lines of credit, installment loans and “flex loans” through state-specific subsidiaries such as CNU of Alabama, LLC and CNU of Texas, LLC. A proposed nationwide class action, Galvan v. CNU of Alabama, LLC, No. 1:26-cv-05957, filed May 21, 2026 in the U.S. District Court for the Northern District of Illinois, alleges that those loans violate the Military Lending Act (MLA) when made to active-duty service members and their families.The plaintiff, the spouse of an active-duty U.S. Army staff sergeant, filed an amended complaint on August 13, 2026 naming Enova, two holding companies and 13 CashNetUSA lending entities. On October 16, 2026, the defendants filed a motion to compel arbitration and a motion to dismiss. The case is before U.S. District Judge Jeffrey I. Cummings, and no court has ruled on the allegations.
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What the Lawsuit Alleges
The Military Lending Act caps the military annual percentage rate (MAPR), which counts fees and other charges along with interest, at 36% on consumer credit to active-duty service members and their dependents. The amended complaint reproduces CashNetUSA’s published state-by-state pricing: daily interest of roughly 0.55% to 1.59%, plus, in many states, a 15% transaction fee on each draw. It says that adds up to APRs of 199% to 325% on lines of credit in states such as Alabama, Kansas, Missouri and Utah, up to 449% on Wisconsin installment loans and 222% to 579% on Texas loans.Beyond the rates, the complaint alleges that CashNetUSA’s standard loan agreement:
- was signed without the written and oral MLA disclosures the law requires before credit is extended
- requires borrowers to link a bank account and authorize automatic debits timed to payday, which the complaint says uses the account as security in violation of the MLA
- lets the lender elect individual arbitration, and requires waivers of jury trial and class action rights, which the MLA bars for covered borrowers, even though the agreement allows a 60-day opt-out
- imposes a written-notice and pre-suit negotiation process the complaint calls unreasonable
The complaint also alleges CashNetUSA should have known the plaintiff was a covered borrower: it says her credit report showed her income came from veterans’ disability payments and her husband’s military pay, and that the bank account she linked was at Navy Federal Credit Union.
According to the complaint, she opened a CashNetUSA account on November 14, 2023 and was approved for a $2,000 line at a 229% APR, which she drew in full; the limit was raised to $2,250 in February 2024. She borrowed $4,810 in all through May 2025, and by June 2025 still owed $703.79 after thousands of dollars in monthly payments, mostly interest. The complaint gives an example of how the payments work: on an $800 balance, a biweekly debit of $124.64 would include $84.64 in interest and fees and only $40 of principal.
Who Is in the Proposed Class?
The amended complaint proposes a nationwide class of all active-duty service members and dependents of active-duty service members who entered into a CashNetUSA loan on the standard form agreement within five years before the original complaint was filed on May 21, 2026, and made at least one payment. It argues that the Servicemembers Civil Relief Act pauses the deadline while a service member remains on active duty, which could reach older loans. The complaint says covered borrowers can be identified by checking CashNetUSA’s borrower list against the Defense Department’s MLA database. A court must certify a class before anyone is formally part of the case.What the Lawsuit Seeks
The MLA provides that a credit agreement that violates its protections is void from the inception of the contract, and it allows covered borrowers to sue for actual damages of at least $500 per violation, punitive damages and other relief. The complaint asks the court to declare class members’ loans void, to bar CashNetUSA from collecting on them, and to award damages, punitive damages and attorneys’ fees. None of that has been awarded.What Happens Next
The defendants’ October 16, 2026 motions are the first big test. Lenders facing MLA suits often argue the borrower must arbitrate individually under the loan agreement; the plaintiff argues the MLA makes that clause unenforceable against covered borrowers, citing an April 2026 New York federal ruling in a MoneyLion case that an arbitration clause with a mail-in opt-out was still barred. The court has said it will wait to set a discovery schedule until it has reviewed the motion to dismiss. Class certification, if it comes, would follow later. There is nothing to file in the CashNetUSA case now.Other Military Lending Act cases on OCA include the FirstCash $5 million settlement for pawn loans, automatic Cash App Borrow payments for service members, and a Klover cash advance suit that survived a motion to dismiss.
Questions
Is there a CashNetUSA Military Lending Act lawsuit?
Yes. Galvan v. CNU of Alabama, LLC, No. 1:26-cv-05957, is a proposed nationwide class action in the U.S. District Court for the Northern District of Illinois alleging that CashNetUSA’s loans to active-duty service members and their families violated the Military Lending Act. No class has been certified, there is no settlement and there is nothing to claim.
What rates does the lawsuit say CashNetUSA charged service members?
The amended complaint alleges that, counting interest and transaction or customary fees, CashNetUSA loans cost approximately 222% to 579% a year, depending on the product and the state. The Military Lending Act caps the military annual percentage rate on covered consumer credit to active-duty service members and their dependents at 36%.
Who would be in the proposed CashNetUSA class?
The amended complaint proposes a nationwide class of all active-duty service members and dependents of active-duty service members who entered into a CashNetUSA loan on the standard form agreement within five years before the case was filed on May 21, 2026 and made at least one payment. It argues the Servicemembers Civil Relief Act extends that period for people still on active duty. A court has not certified the class.
What does it mean that the loans are void from inception?
The Military Lending Act says a credit agreement that violates certain of its rules is void from the inception of the contract. The lawsuit asks the court to apply that provision to the CashNetUSA loans. Whether it applies, and what it would mean for any balance, is for the court to decide.
Sources
• First Amended Class Action Complaint, Galvan v. CNU of Alabama, LLC, No. 1:26-cv-05957 (N.D. Ill., filed August 13, 2026), ECF No. 27, and docket entries through October 16, 2026: CourtListener docket.• Military Lending Act, 10 U.S.C. § 987, and Department of Defense rule, 32 C.F.R. Part 232.
