New payday lending rules that passed through Parliament last week will be positive for the sector, according to the short-term lender Cash Converters.The general manager of Cash Converters Australia, Ian Day, provided some commentary on the new rules in the company's 2011/12 financial report, which was issued yesterday.Day said: "The outcome from the legislative process is positive for Cash Converters, as a significant proportion of our earnings are generated from the provision of short-term credit and these rate caps give us a sustainable model that will see earnings grow."Payday lending provisions in the Consumer Credit and Corporations Legislation Amendment (Enhancements) Bill limit the upfront fee on a finance contract of up to A$2000 to 20 per cent. Monthly charges are limited to four per cent.The Government had initially proposed tougher limits but accepted the recommendations of a Senate committee review that it should give payday lenders more leeway."Adopting a fee cap allows us to recoup the significant establishment costs up front," Day said.Cash Converters reported a net profit of $29.4 million for the year to June - up 6.2 per cent on the previous year. Revenue was up 25.7 per cent, but expenses were also up.Cash Converters has a personal loan business in Australia and in the United Kingdom, and a chain of pawn shops. Operating profit from the personal loan business was up 37 per cent, while store operations were down 34 per cent.The number of loans approved in Australia rose 35 per cent, to 107,000 and in the UK rose 77 per cent, to 28,000. The average loan size was A$331 in Australia and £121 in the UK.The company said it expected continued growth in the current financial year.