AFSPA
ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
December 18, 2018
2018 edition: 100 / 104
Happy Holidays
microbilt
Lend smarter. Collect quicker. Grow your business.

An Unwelcome About-Face on Payday Lending

Regulators wanted to curb predatory short-term loans. The Trump administration seems to have other plans.

In its seven-year history, the Consumer Financial Protection Bureau has done a lot of good. Among its most notable achievements: Last year, it issued the first federal rule to curb the predatory aspects of the small-sum, short-term credit known as payday lending and to encourage mainstream banks to offer better alternatives.

The bureau, now under new leadership, wants to dismantle the rule before it can fully take effect. Democratic legislators, having gained control of the House of Representatives, should do what they can to resist.

Sometimes it can make sense to pay $60 to borrow $400 for a couple weeks - for example, to fix a car you need to get to work. But such loans can trap borrowers in cycles of debt. Often, they are meant to do just that. Unable to repay, people borrow again and again, paying much more than the original amount in interest and fees. By encouraging such behavior, payday lenders extract billions a year from the poorest and most vulnerable Americans.

The CFPB struck a reasonable balance between stopping the worst abuses and keeping emergency credit available. It gave lenders two options: Verify customers' ability to pay, or allow them to return the money more gradually. The rule applied only to the most problematic loans - those with terms of less than 45 days. This was meant to nudge banks to enter the market with less expensive, longer-term loans. Read more at BLOOMBERG


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CFPB
The 2018 Financial Literacy Annual Report sums up a year of achievements in financial education

Financial education is a critical part of the Bureau's mission to empower people to take more control over their economic lives.

The 2018 Financial Literacy Annual Report details how the Bureau works toward this goal by:

Providing financial education directly to the public, and by expanding local delivery of financial information
Sharing research on effective financial education and financial well-being with financial educators
Addressing needs for inclusion and financial security of servicemembers and veterans, older Americans, historically underserved communities, and students

Inside the report
Read the report and discover the many programs and tools the Bureau provides to help enhance the financial knowledge and skills of people throughout the country, from childhood to later life, so that they can build financial well-being.

For help navigating financial decisions, consumers can use Web-based guides like Buying a House, Planning for Retirement, and other consumer tools. From October 2017 to September 2018, more than 9.9 million people turned to our online and print resources, which include:

More than 1,000 questions and answers through the Bureau's online Ask tool
The 10-question Financial Well-Being Questionnaire
Facts and worksheets on debt collection, credit scores, budgeting and spending, and more
Read more at CFPB

MaxDecisions
Lending as a Service

America's banks are slowly vanishing

America's bank tellers and the branches they work in are dwindling across the nation and that could spell trouble.

"We are at a historical low with the number of banks in our country," said Florida Bankers Association CEO Alex Sanchez during an appearance on FOX Business' "Mornings with Maria" on Friday. "I think we are not seeing the startup banks like we used to."

Sanchez Opens a New Window. , who oversees one of Florida's oldest trade associations, is putting the onus on the new Congress to address this issue. Democratic Representative Maxine Waters, who takes over as chair of the House Financial Services Committee in January, which oversees the banking industry, could help.

She could potentially slow Trump's deregulatory efforts, or use her powers to look for ways to improve the economy Opens a New Window. , Sanchez said.

The total number of banks in the U.S. declined from around 19,000 in 1990 to about 5,000 in 2018, according to the FDIC. Opens a New Window. And just last week, FDIC Chair Jelena McWilliams sounded the alarm over the shortage saying there aren't enough new banks opening up in the country. Read more at FOX BUSINESS

ACCELITAS
Accelitas is an alternative data resource that delivers the power of AI to reach more underserved consumers and deliver predictive insights that are customized to your business. Click to learn more

Helping New Workers Achieve Financial Security. by David Kilby, President, FinFit

It's a challenge for any company to attract top talent. This primarily rings true in a competitive labor market where unemployment sits at roughly 3.7%, the lowest in nearly 50 years.1

As a company fighting for this talent, how do you set yourself apart? Sure, an employee may enjoy unlimited cappuccinos from the company cafeteria while sitting comfortably in a beanbag chair located in an open-air office, but sometimes people want more. They NEED more. That's what makes financial education and wellness so important to recruiting and retaining your employees.

Many people think that financial wellness in the workplace simply means offering a 401k and an employer match program. That's a start, but financial wellness offerings can range from financial risk assessments, budgetary calculators, analysis of spending habits, home purchasing advice, managing student loans, and short-term and long-term savings goals, just to name a few.

Medical insurance costs continue to increase. Student loan debt is sitting at $1.4 trillion.2 Seventy-five percent of Americans live paycheck to paycheck,3 and the average American doesn't have more than $400 in savings.4

This is especially apparent with the Millennial and Gen Z workforce. Millennials comprise the largest generation in the workforce (35%5), and they struggle with financial wellness significantly more than prior generations. Lower starting salaries and crippling student debt are two leading causes of poor financial health among this generation. Read more at HR DAILY ADVISOR

LoanPaymentPro
We are a revolutionary merchant service and technology firm servicing the debt repayment industry.

Know These 6 Federal Tax Changes to Avoid a Surprise in 2019

Last year's Tax Cut and Jobs Act of 2017 made significant changes to federal tax laws -- rejiggering tax brackets, capping some tax deductions and eliminating a few others.

Those changes will determine how much money people can write off on their taxes when they file in 2019. To avoid a nasty surprise, taxpayers should make a date with their financial planners or accountants before the end of the year to huddle about any last-minute strategies and review their most recent tax return.

"The big change for individuals is with deductions," says Craig Richards, managing director and director of tax services at Fiduciary Trust Company International in New York. "A lot of things that we've talked about in the past, they're not there anymore. For example, prepaying your real estate taxes is not going to do you any good."

Although the standard deduction nearly doubled to $12,000 for single tax filers and $24,000 for married couples filing jointly, key deductions like state and local taxes and mortgage interest were capped at $10,000. That's going to hurt people in states where property and or income taxes are high. Further, the tax code suspends miscellaneous deductions, such as certain types of home equity interest deductions and fees paid to accountants and investment advisors -- these can no longer be written off.

According to tax experts, here are the top six key changes in the new federal tax code:
Read more at YAHOO NEWS

  MerchantBoost
We are transforming lending with innovative payment instrument data and technology, increasing credit access to the financially underserved, and reducing fees for borrowers and creditors.

Bloomberg Commentary: House should resist reversal of payday loan rules

A consumer watchdog, now under Trump administration, wants to kill rules meant to protect borrowers.

In its seven-year history, the Consumer Financial Protection Bureau has done a lot of good. Among its most notable achievements: Last year, it issued the first federal rule to curb the predatory aspects of the small-sum, short-term credit known as payday lending and to encourage mainstream banks to offer better alternatives.

The bureau, now under new leadership, wants to dismantle the rule before it can fully take effect. Democratic legislators, having gained control of the House of Representatives, should do what they can to resist.

Sometimes it can make sense to pay $60 to borrow $400 for a couple weeks, for example, to fix a car you need to get to work. But such loans can trap borrowers in cycles of debt. Often, they are meant to do just that. Unable to repay, people borrow again and again, paying much more than the original amount in interest and fees. By encouraging such behavior, payday lenders extract billions a year from the poorest and most vulnerable Americans.

The CFPB struck a reasonable balance between stopping the worst abuses and keeping emergency credit available. It gave lenders two options: Verify customers' ability to pay, or allow them to return the money more gradually. The rule applied only to the most problematic loans, those with terms of less than 45 days. This was meant to nudge banks to enter the market with less expensive, longer-term loans. Read more at BLOOMBERG

TransUnion
Compete in the data-driven lending era

U.S. Consumer Credit Market Poised for More Growth in 2019

TransUnion forecasts originations to grow and delinquency rates to fall for most credit products

Low unemployment rates and continued positive growth in both GDP and real disposable income are among the key drivers that will propel the U.S. consumer credit market in 2019. Partly due to the strong performance of these economic indicators, TransUnion's (NYSE: TRU) 2019 consumer credit forecast found that originations and consumer balances are expected to increase for most credit products, while serious delinquency rates will likely decline or remain steady.

"The consumer credit market has been buoyed by relatively strong macroeconomic factors this year, and our forecast sees more of the same in 2019," said Matt Komos, vice president of research and consulting for TransUnion. "Consumer demand for both personal loans and auto loans is expected to remain high, and lenders are expected to continue looking to expand their books of business by providing more subprime and near prime borrowers with loans. This is a positive for both lenders and consumers. Delinquency rates remain at either low or 'normal' levels, and lenders have confidence to open up their portfolios to slightly more risk. From a consumer perspective, subprime and near prime borrowers accessing new credit will now have even more opportunity to showcase that they can responsibly manage their payments. We anticipate the trend of managing risk exposure through loan amount and line management strategies for these higher risk consumers will continue into 2019." Read more at TRANSUNION

DMS
Creating and producing results since 1982

Half of America hasn't recovered from the recession

A decade after the financial crisis, the U.S. economy seems to be firing on all cylinders, with unemployment at a 50-year low and growth hitting its stride. But a deeper look reveals a more troubling picture: Between 2012 and 2015 -- a period when the recovery seemed to be gaining speed -- nearly half of all counties nationwide saw flat or declining growth, according to new government data.

More broadly, the Commerce Department figures highlight a stark and worrisome reality: While a handful of places around the U.S. are thriving, most regions are barely trudging ahead. And that trend is creating a widening geographic gap between a relatively few prosperous areas, mostly urban oases, and the desert of stagnation that lies beyond.

"For many communities, what you've got is a lost decade of economic growth," said John Lettieri, CEO of the Economic Innovation Group, a bipartisan think tank, adding that "the topline economy doesn't match the local experiences."

The bottom third of U.S. counties actually saw their economies shrink. Gross domestic product in these places, whose ranks include St. Clair County, Missouri, and Macon County, Illinois, shrank by an average of 2.25 percent each year between 2013 and 2015. (GDP represents the sum total of all the goods and services produced in a location in a given year.) For another 20 percent of counties, growth averaged an anemic 0.6 percent a year during that period. Read more at CBS NEWS

Insight
We help you buy BETTER leads.

New Head of CFPB Vows Consumers Will Be Top Focus

New head of Consumer Financial Protection Bureau promises to put consumers first.

WASHINGTON (AP) - The new head of the U.S. consumer watchdog agency says she doesn't have immediate targets in mind for rolling back actions taken by her controversial predecessor, and will put protecting consumers in the forefront while also encouraging financial innovation.

Kathy Kraninger, nominated by President Donald Trump and confirmed by the Senate last week on a narrow, party-line vote, has replaced Mick Mulvaney as director of the Consumer Financial Protection Bureau.

Mulvaney, named by Trump as acting director a year ago, had been a vocal critic of the agency and made deep changes to it. He proposed cutting back many of the CFPB's rules put in place during the Obama administration and scaled back its enforcement efforts.

"We absolutely will put consumers first in the decisions that I will make," Kraninger said Tuesday in her first meeting with reporters.

A leading priority will be the security and privacy of data, what the agency collects from consumers and what it stores, she said. Read more at THE ASSOCIATED PRESS

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These cities have the most six-figure job openings

While many Americans' wages have remained largely stagnant during the economic recovery, the prospects for higher salaries might be greater in some cities than others.

Job search site Ladders compiled a list of the cities with the highest number of six-figure job openings this month, which are spread out across the country.

Here's a look at the top 10:
1. San Francisco
It may come as no surprise that San Francisco - which is nearby the technology mecca known as Silicon Valley - has the highest number of six-figure job openings.
Many of the country's largest companies, including Uber and Salesforce, have headquarters in San Francisco.
According to Ladders, there are 28,917 current job openings in the city that offer salaries of at least $100,000.

2. New York City
Following San Francisco is New York City, which is hiring for 23,325 jobs with six-figure salaries.
New York City is home to Wall Street and some of the world's largest businesses.
Read more at FOX BUSINESS

  NDH
National Debt Holdings is a professional Receivables Management Company that partners with creditors to purchase and/or manage receivables at all stages of the account life cycle.

College student bank accounts charge more, CFPB report reveals

College-sponsored bank accounts charge students substantial and "legally dubious fees," a new report from the Consumer Financial Protection Bureau (CFPB) revealed.

The report covers some 573 colleges during the 2016-2017 Award Year that were in marketing agreements with banks to promote services to students. Schools were awarded payments on a per-account basis, including a fixed amount for each student, or annual payments based on the total number of students using an account.

The report raises concerns about these marketing agreements between banks and schools, questioning whether the deals bring a "conflict of interest" and result in higher-fee products.

Marketing deals generate money for colleges
The colleges had agreements with 14 financial institutions, including large and small banks, specialty non-bank providers and credit unions. About 1.3 million students were holders of sponsored accounts, resulting in a payout of over $16.6 million to schools from providers.
Read more at BANKRATE

Alchemy
We are a revolutionary merchant service and technology firm servicing the debt repayment industry

Small business optimism posts 2-year streak of record highs

Small business optimism continued its two-year streak of record highs, according to the NFIB Small Business Optimism Index, with October's reading coming in at 107.4.

"For two years, small business owners have expressed record levels of optimism and are proving to be a driving force in this rapidly growing economy," said NFIB CEO Juanita Duggan. "The October optimism index further validates that when small businesses get tax relief and are freed from regulatory shackles, they thrive and the whole economy prospers."

The NFIB says that small businesses continue to add new employees, while they believe the current climate is a good time to expand and they are planning to invest in more inventory.

Thirty percent of small business owners said now is a good time to expand substantially, with 72 percent citing the economy and 14 percent naming strong sales. A net 5 percent of owners plan to invest in more inventory, the 21st-positive month since January 2017.
Read more at FOX BUSINESS

Dreher Tomkies LLP
Dreher Tomkies LLP is a law firm concentrating in the areas of Banking and Financial Services law.

New CFPB Director: Privacy, Data Security Are Priorities

Kathy Kraninger, the new head of the Consumer Financial Protection Bureau (CFPB), has said that she'll prioritize the protection of consumers over regulatory issues, according to a report by the Chicago Tribune.

Kraninger was nominated by President Trump and confirmed last week in a narrow vote along party lines. She's the replacement for Mick Mulvaney, the former agency head.

"We absolutely will put consumers first in the decisions that I will make," Kraninger said Tuesday (Dec. 11).

Kraninger did not say if she would target some of the rollbacks enacted by Mulvaney, who proposed scaling back many CFPB rules written during the Obama years. He also cut back its enforcement actions.

Mulvaney often said that under Obama, the CFPB overreached enforcement against companies.

Kraninger said her main priority will be security and privacy of data, and analyzing what the agency gets from consumers and what it keeps. She said she won't take any action lightly, and will review information and seek consultation before any big decisions are made. Read more at PYMNTS.COM

 
AFSPA
ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
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Alternative Financial Service Providers Association
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