ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
December 17, 2020
The Gateway For Payroll Data
1.7 billion people globally are unbanked – IMF

The Director General of the International Monetary Fund (IMF) Kristalina Georgieva has revealed that 1.7 billion adults around the world are still unbanked.

She said about half of unbanked people include women from poor households in rural areas or out of the workforce.

Madam Georgieva said these during a virtual conference on Financial Inclusion and Cybersecurity Co-hosted by IMF, Carnegie Endowment for International Peace, World Bank, and the World Economic Forum on Thursday December 10.

Paving the Payments Future
These states have the highest debt burdens

Average credit card debt nationwide fell 6%

Southern states are facing the highest burden of credit card debt during 2020, and Louisiana residents have the biggest burden of all, a recent CreditCards.com survey found.

For the Pelican State, the average household carries $7,940 in credit card debt and earns a median income of $51,073, according to the data released Monday.

If residents pay off debt with 15% of earnings, it would take a Louisiana credit cardholder 15 months to absolve their debt, while paying $1,013 in interest, analysts noted.

Get Ready for Taxes: What’s new and what to consider when filing in 2021

WASHINGTON — The Internal Revenue Service today encouraged taxpayers to take necessary actions in the final weeks of the year to help file federal tax returns timely and accurately in 2021.

This is the third in a series of reminders to help taxpayers get ready for the upcoming tax filing season. A special page, updated and available on IRS.gov, outlines steps taxpayers can take now to make tax filing easier in 2021.

On-Demand Pay: What Does the CFPB Have to Say About It?

Over the years, consumers have become accustomed to getting what they want when they want it, usually by doing no more than clicking a few buttons. They can watch new shows by the season, get same day shipping from marketplaces like Amazon, and order groceries online for immediate delivery.

So it makes sense that this desire for immediacy extends past commodities. Employers are beginning to implement a system referred to as on-demand pay, which is exactly as it sounds: pay day, any day. On-demand pay gives employees access to wages as they are earned.

The Consumer Financial Protection Bureau (CFPB) recently released an advisory opinion titled “Truth in Lending (Regulation Z); Earned Wage Access Programs,” which explains the nuances of earned wage access (EWA) and the complications of regulatory uncertainty.

Kraninger Marks Second Year as Director of the Consumer Financial Protection Bureau

WASHINGTON, D.C. – Today, Consumer Financial Protection Bureau (Bureau) Director Kathleen L. Kraninger made the following statement regarding her second-year anniversary leading the Bureau:

“In these challenging times, I’m proud of the work that the Bureau has undertaken to protect consumers during the pandemic,” said CFPB Director Kraninger. “We have a dedicated workforce that has been focused on carrying out our mission and adapting to the current environment. For example, we have altered the way that we conduct examinations to protect our workforce as they work to protect consumers in the marketplace. We will continue to use all of our tools to prevent consumer harm through education, supervision of financial markets, development of regulation, and enforcement of the law against bad actors.”

Risky Home Financing Options Leave Millions Vulnerable

Limited research hinders broad policy reform

Most American homeowners finance their homes using traditional amortized mortgages. However, millions have also used nonmortgage alternative financing arrangements, especially in places with lower-cost homes—those valued below $150,000—where access to traditional mortgages tends to be limited.

In some instances, alternative financing may provide a pathway to homeownership, but experts warn that these arrangements lack the important protections that accompany mortgages, potentially placing borrowers at risk. The available evidence indicates that many families end up sinking thousands of dollars into a home they never own, mired in legal issues, or saddled with substantial debt.

3 Ways Minority-Owned Banks Make a Difference in America

One type of bank plays an outsized role in creating more economic opportunity for people of color.

From a Black leadership perspective, a bank is more than “a place where someone can drop off a deposit or get a loan,” says Kevin Cohee, CEO and chairman of OneUnited Bank, one of the biggest Black-owned banks in the U.S. “That’s just the beginning.”

OneUnited Bank’s first loan in the Paycheck Protection Program, part of the federal response to the COVID-19 pandemic, “was to a single mother of seven who drove for Uber,” Cohee says.

Minority-owned banks, or what government agencies term minority depository institutions, must have either most stockholders or members of their board of directors be people of color. This differs from the predominantly white boards of directors among the biggest U.S. banks.

How Bank of America's small-business strategy laid groundwork for PPP efforts

A 'digital plus human' strategy, combined with ongoing tech investments, helped position the nation's second-largest bank to deliver more than 343,000 PPP loans.

As lawmakers debate a new stimulus package, including the possibility of a new tranche of Paycheck Protection Program (PPP) funding, banks that delivered large volumes of PPP loans this year may find themselves better prepared for a third rollout.

For many of these institutions, including Bank of America, success depended not just on how they reacted to the crisis, but how they were able to build on groundwork they already had in place. For the nation's second-largest bank, this represented a new iteration of its digital and human-supported approach to business banking.

The average American has $90,460 of debt—but the average net worth is actually more than that

Knowing your net worth can help you decide if your debt load is manageable or not. CNBC Select reviews the average net worth by age based on Federal Reserve data.

While a debt-free lifestyle might seem enviable, the reality is that most Americans carry some sort of debt and that’s not necessarily a bad thing. In 2019, credit bureau Experian reported the average total debt per consumer (including mortgages) was $90,460, which outpaced the average annual income of $50,413.

If that sounds alarming, remember there’s more to someone’s financial situation than just their debt and income. Another key figure to look at is net worth, or the total value of your assets minus your debt.

Search data suggests Canadians turning to expensive car title loans amid recession

If internet search trends are a window into the minds of consumers, then a recent report suggests that a growing number of Canadians are considering some ill-advised financial options, observers say.

Amid a pandemic-related surge in interest in personal finance information, the number of searches involving car title loans almost tripled in Canada in the March-to-September period this year to 16,900 per month, compared with about 5,900 searches per month at the same time a year earlier, according to SEMrush.

The Boston-based marketing firm that studies internet search trends said Canadian searches for payday loans, meanwhile, fell by 43 per cent to 22,900 from 39,700 during the same period, which was marked by millions of people losing their jobs as non-essential stores and industries were forced to close in an effort to contain the spread of the COVID-19 virus.

Despite tough economic climate, credit card debt drops by 9% 

Even though 2020 was tough financially for many, the overall state of U.S. credit card usage improved. CNBC Select reviews Experian’s data.

This has been a year unlike any other, and so it’s not entirely surprising that many Americans have changed the way they use credit cards.

Millions of Americans filed for unemployment in 2020, and millions more shifted from commuting to an office daily to working from home full-time as a result of the pandemic. Stay-at-home orders across the country means that people are dining out, shopping and traveling less. And as a result, many have seen significant changes to their daily spending. And these changes are having a positive impact on their credit usage.

States Can Shorten Probation and Protect Public Safety

Wide variations in policies and term lengths across states point to opportunities for reform

Overview
More than 3.5 million, or 1 in 72, adults were on probation in the United States at the end of 2018—the most recent year for which U.S. Bureau of Justice Statistics (BJS) data is available—more than triple the number in 1980.1 Nationwide, on any given day, more people are on probation than in prisons and jails and on parole combined.

At its best, probation—court-ordered correctional supervision in the community—gives people the opportunity to remain with their families, maintain employment, and access services that can reduce their likelihood of reoffending while serving their sentences. But, as previous research by The Pew Charitable Trusts has shown, the growth and size of this population have overloaded local and state agencies and stretched their resources thin, weakening their ability to provide the best return on taxpayers’ public safety investments, support rehabilitation, and ensure a measure of accountability.2 One key factor driving the size of the probation population is how long individuals remain on supervision.

ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
Alternative Financial Service Providers Association
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