ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION | | |
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edition: June 10, 2025
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U.S. Market Close 6/9/2025
DOW 30 -0.00% -1.11 42,761.76
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U.S. Financial Literacy Growth 'Stagnant,' Report Finds
The country’s overall financial literacy is not improving. That’s the message in the 9th annual Personal Finance Index, which found that financial literacy remains low among U.S. adults.
The country’s overall financial literacy is not improving.
That’s the message in the 9th annual Personal Finance Index (P-Fin Index), which found that financial literacy remains low among U.S. adults. Respondents, on average, correctly answered only 49% of the index questions across eight key personal finance areas, the same as in 2017.
A joint initiative by the TIAA Institute and Stanford University’s Global Financial Literacy Excellence Center (GFLEC), the report highlighted “the important role financial literacy plays in financial well-being.” It noted that adults with very low financial literacy are twice as likely to be debt-constrained and three times more likely to be financially fragile than those with very high financial literacy.
“The persistent low levels of financial literacy underscore the need for targeted educational initiatives,” Annamaria Lusardi, a Stanford economist and a TIAA Institute Fellow, said in a statement. “To promote long-term financial security, it is essential to develop educational programs tailored to the diverse needs of various demographic groups and provide support where possible to help individuals make informed financial decisions.”
Read more at The National Association of Plan Advisors
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Walmart is using its own fintech firm to provide credit cards after dumping Capital One
Key Points
- Walmart’s majority-owned fintech startup OnePay said Monday that it was launching a pair of new credit cards for customers of the world’s biggest retailer.
- To do so, OnePay is partnering with Synchrony, a major behind-the-scenes player in retail cards, which will issue the cards and handle underwriting decisions starting in the fall, the companies said.
- OnePay, which was created by Walmart in 2021 with venture firm Ribbit Capital, will handle the customer experience for the card program through its mobile app.
Walmart’s majority-owned fintech startup OnePay said Monday it was launching a pair of credit cards with a bank partner for customers of the world’s biggest retailer.
OnePay is partnering with Synchrony, a major behind-the-scenes player in retail cards, which will issue the cards and handle underwriting decisions starting in the fall, the companies said.
Read more at CNBC
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Is This the End of Paper Checks?
After Trump signed an executive order ending the federal use of paper checks, experts were relieved.
President Donald Trump has signed an executive order requiring departments and agencies to phase out the use of checks and switch exclusively to electronic payments by Sept. 30.
Key Takeaways
- The federal government is phasing out the use of paper checks by Sept. 30, 2025.
- Social Security benefits and tax refunds will only be paid electronically.
- Check use has been declining for decades but is still commonly used for certain types of transactions.
- The paper check's days in the federal government are numbered. But how much longer will we pay with checks at all?
President Donald Trump has given departments and agencies until Sept. 30 to phase out their use of checks and switch to exclusively using electronic payments, including for Social Security benefits and tax refunds. The executive order issued in March aims to "modernize how the government handles money," the White House said.
"Paper-based payments, such as checks and money orders, impose unnecessary costs, delays, and risks of fraud, lost payments, theft, and inefficiencies," the White House said.
Read more at USNEWS.COM
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As consumers embrace digital banking they’re turning their eye toward AI-powered features
According to a recent survey, more and more of us are engaging regularly with banking apps. Here’s how the technology is evolving.
For Tim Ferriter, managing director and head of digital at Chase, cash birthday gifts have become a relic of the past. “Where grandparents would have once put cash in a card or written a check, now they’re using payment apps,” he says. That’s because tools that allow person-to-person (P2P) payments, like Zelle, have become so popular and easy to use.
The latest Digital Banking Attitudes survey by Chase, the fifth the company has conducted since 2020, shows the rise in usage. Polling 2,000 U.S. consumers between the ages of 18 and 65 in February, the survey found that 67% had used P2P payments in the past year—a significant increase from the 40% surveyed in 2020. Meanwhile, 78% reported using banking apps weekly, while 62% said they couldn’t live without those apps.
Read more at FAST COMPANY
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Economic Outlook and Final Thoughts
Good afternoon, everyone, and once again welcome to the Federal Reserve Bank of Philadelphia.
Thanks to Paul for that introduction. As many of you know, Paul leads the Philly Fed’s Beige Book effort, speaking with contacts and analyzing a host of regional economic data. He is also a multiple Beigies winner and, he may not like that I share this, is also the Federal Reserve System’s foremost expert in the regional impact of Taylor Swift. In every case, Paul, thank you for all you do.
And I also give my thanks to the Philadelphia Council for Business Economics (PCBE) and, more broadly, the National Association for Business Economics (NABE), for their strong standing relationship with the Philly Fed. We are aligned not just in providing a location here at the Bank for regular meetings, but also in our mutual goal of ensuring an open forum for the timely discussion of economic issues impacting both the city and region. We all look forward to welcoming NABE’s annual meeting to Philadelphia this fall.
Read more at Federal Reserve Bank of Philadelphia
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CFPB states the Section 1033 Open Banking rule exceeds its authority: Kristen E. Larson & Ronald K. Vaske
In its motion for a summary judgment in a lawsuit challenging the regulation, the CFPB stated it has concluded that the Section 1033 Rule (Rule) exceeds the agency’s statutory authority to create an open banking system by—among other things—requiring that consumer data be shared with third parties.
The motion states that “the limited legislative history confirms what the statute’s text and structure make clear: the statute was intended simply to ensure that consumers would have access to their own information.”
Therefore, the CFPB requested that the court grant plaintiff’s motion for summary judgment.
“In light of the President’s directive to review existing regulations, the Bureau’s new leadership has considered the Rule and the arguments set forth in Plaintiffs’ complaint and amended complaint and has concluded that the Rule exceeds the Bureau’s statutory authority and is arbitrary and capricious,” the CFPB said,
Read more at Ballard Spahr L.L.P
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Arizona Financial launches Azpire to serve underbanked population
With over 600,000 Arizonans estimated to be underbanked, Arizona Financial Credit Union has announced the launch of Azpire, a dedicated new initiative aimed at addressing the needs of individuals who operate outside of traditional banking systems.
Unbanked and underbanked individuals often rely on alternative financial services such as check cashing, title loans, and money service counters – paying steep fees and some of the highest borrowing rates in the market, with car loans often exceeding 20% and credit card rates topping 30%. Many are left behind due to low income, limited financial education, or life-altering events such as divorce or medical emergencies.
“The traditional financial system isn’t designed for everyone,” said Jason Paprocki, chief strategy officer at Arizona Financial Credit Union. “Too many people are ignored or turned away because they don’t fit into automated decision-making models. With Azpire, we’re creating a new path that is more empathetic, accessible, and designed to meet people where they are.”
Read more at AZBIGMEDIA.COM
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3 Ways Cities are Using Financial Empowerment to Advance Economic Mobility of Their Residents
Financial empowerment is more than just budgeting tips and credit scores — it’s about equipping communities and their residents with the tools to build lasting economic stability, security and wealth. Nationally, cities of all sizes are embracing holistic strategies that go beyond one-time financial assistance, by integrating coaching, workforce development and housing support to create real, sustainable change.
In the NLC report, A Decade of Municipal Financial Empowerment Strategies, researchers captured the emerging trends, successful strategies and impact of different programs across the country. One of the key findings from the report suggests municipalities are moving away from individual programs into a broader systems change approach. Each of the cities represented below utilized a tailored yet interconnected approach to meet the needs of their residents, proving that financial empowerment programs, policies and procedures are not a one-size-fits-all approach.
Read more at National League of Cities
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The salary a single person needs to live comfortably in all 50 U.S. states—it’s over $120,000 in 2 places
Americans earning a regular salary may have trouble living comfortably in all 50 states.
The median annual wage for individuals was just below $62,000 at the end of 2024, according to the Bureau of Labor Statistics. But it takes a salary of at least $80,829 for a single adult to live comfortably in West Virginia, the most affordable state, according to a recent SmartAsset study.
SmartAsset defines “comfortable” as earning enough to follow the 50/30/20 budget method, which recommends putting 50% of your income toward essentials like rent and food, 30% toward discretionary spending and 20% toward debt repayment and savings. It used the latest estimates from Massachusetts Institute of Technology’s Living Wage calculator to estimate individuals’ cost of necessities in each state.
Read more at CNBC
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How much you need to earn to be upper-middle class in every U.S. state
Earning more than $110,000 in household income doesn’t make you rich — but in most states, it means you’re upper-middle class.
Nationwide, upper-middle class households earn a median income between $117,000 and $150,000, according to a new GOBankingRates analysis of 2023 Census Bureau data.
The analysis is based on Pew Research’s definition of middle class: households earning between two-thirds and twice their state’s median income. Using the most recent Census data from 2023, GOBankingRates calculated the middle class range for each state, then used the top third to determine what was upper-middle class.
Read more at CNBC
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The Dollar’s Global Role and the Financing of the U.S. External Deficit
There is too much talk about the dollar’s role as a reserve currency and too little talk about expectations of exceptional returns. Reserve accumulation hasn’t driven the financing of the U.S. current account deficit in recent years.
The U.S. share of a leading index of global equities is now around 70 percent. That is significantly above the dollar’s share of global reserves, now around 58 percent.
The dollar share of the portfolio of Taiwan’s huge life insurance industry is thought to be north of 80 percent. That is significantly above the dollar’s share of China’s reserves. That last disclosed number, from 2018, was 55 percent, and my own tracking doesn’t suggest a significant change since then.*
All these numbers call into question the incredibly widespread notion that the “bid” for dollars in recent years is somehow tied to the dollar’s status as the world’s leading reserve currency.**
Read more at Council on Foreign Relations
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Trump aims to slash Pell Grants, which may limit low-income students’ college access
Key Points
- Pell Grants, college aid for low-income families, could be slashed under both the White House budget proposal and House GOP reconciliation bill.
- President Donald Trump’s budget would cut the maximum award to the lowest amount in roughly a decade.
- About 40% of undergraduates rely on Pell Grants to pay for college, and experts say if the plans are enacted, many of the lowest-income students would be forced to drop out.
For many students and their families, federal student aid is key for college access.
And yet, the Trump administration’s budget proposal for fiscal year 2026 calls for significant cuts to higher education funding, including reducing the maximum federal Pell Grant award to $5,710 a year from $7,395, as well as scaling back the federal work-study program. The proposed cuts would help pay for the landmark tax and spending bill Republicans in the U.S. Congress hope to enact.
Read more at CNBC
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Why rising student loan defaults are a boost for buy-here, pay-here dealerships
Recent data from PYMNTS.com reveals a troubling trend: borrower credit scores are plunging following a rise in student loan delinquencies. While many financial institutions may see this as a red flag, savvy buy-here, pay-here dealerships can recognize a golden opportunity: increased demand from credit-challenged consumers who still need reliable transportation.
Millions of Americans are now dealing with the fallout of paused or forgiven student loans coming due again — and with that, an uptick in delinquencies. As a result, FICO scores are dropping across the board, locking consumers out of traditional auto financing.
Enter BHPH dealers.
You independent, in-house financing specialists are uniquely equipped to serve the segment of the population with bad credit — or no credit at all. Instead of relying on strict credit criteria, BHPH operations focus on real-life affordability and employment stability, offering real solutions for real people, especially those facing student loan delinquencies.
Read more at AUTOREMARKETING.COM
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Swipe, spend and regret: The sneaky psychology of credit card spending
Key takeaways
- Psychological triggers can have a major impact on credit card spending.
- Spending on cards can feel easier than paying in cash, but the financial consequences can be steep.
- Help is available if you find yourself battling an overspending habit.
It’s well documented that some cardholders have problems when it comes to overspending on their credit cards, leading to debt that can be difficult to repay.
But why do cardholders feel freer when buying higher-priced items on their cards — including vacations, furniture, electronics, appliances and jewelry — when they would be much more restrained when paying for the same items with cash?
Read more at BANKRATE
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We advise financial technology companies at the
start-up, product development, and product evolution stages.
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How Fintech Is Ensuring Secure International Money Transfers
Innovations in the digital money and international money transfer market have opened the world to a whole new range of convenience, speed, safety, and accessibility in real-time payments and transfers.
But as with most things, where good exists, you would also find some traces of bad. International money transfers are no exception.
Hence, it comes as no surprise that while most businesses and individuals are taking advantage of cross-border money transfer platforms for payments and remittances, some bad actors are also using or manipulating these platforms for fraudulent activities.
As at 1992, less than 1% of fraud reports received by the FTC were related to cross-border payments, but by 2022, it was more than 11%, according to the FTC.
Read more at FFNEWS.COM
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Equifax Redesigns U.S. Consumer Credit Report to Help Consumers More Easily Monitor Financial Health
Equifax® (NYSE: EFX) is making it even easier for U.S. consumers to understand their credit history and monitor their financial health with the introduction of a new, reimagined consumer credit report design. Available now to U.S. consumers who request hard copies of their Equifax credit report, the new industry leading credit report enables people to more easily view their current VantageScore® 3.0 credit score and provides easy-to-read graphics for a comprehensive view of current and past credit activity.
"Equifax plays an important role in the financial lives of consumers and we take that responsibility very seriously," said Mark W. Begor, CEO of Equifax. "Our updated and industry leading U.S. consumer credit report is another way that we are putting putting consumers first and delivering on our Purpose - to help people live their financial best - into action, empowering consumers to take control of their financial well-being and make more informed financial decisions with a clear understanding of the factors that can affect their credit."
Read more at KTLA.COM
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Looking at May’s 7% rise in bankruptcies as opportunities for dealers
A Midwestern franchised dealer who uses OnlineBKmanager.com shared this anecdote with president Robert Davies ahead of the latest data provided by Epiq AACER, which said total U.S. bankruptcy filings increased another 7% year-over-year in May.
“We’re seeing buyers come in just a day or two after filing,” the store sales manager, who has been using OnlineBKmanager.com since 2015, told Davies. “These aren’t ‘bad credit’ shoppers. They’re working families who hit a financial wall, often because of a medical situation or job loss.
“Once their bankruptcy is filed, many of them qualify for financing within their means. And they’re grateful for a dealer who treats them with dignity and arranges financing through a nationally respected lender who reports to all the credit bureaus.”
Read more at AUTOREMARKETING.COM
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Gen Z's Debt Is Way Worse Than Other Generations
Gen Z is facing significant debt, and it's at a level that far extends past the elder generations.
In a new report from cash advance app Vola Finance, 63 percent of Gen Z users already had delinquencies on their record. Other generations were only delinquent 37 percent of the time.
Why It Matters
Young adults may be dealing with heightened financial pressures than their predecessors amid high inflation, a student debt crisis and widespread housing unaffordability.
A recent poll by Talker Research for Newsweek showed that Gen Z had the highest average personal debt when compared to older groups. Gen Z's average personal debt was already at $94,101, far above millennials ($59,181) and Gen X ($53,255)
Read more at NEWSWEEK
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Franchise Insights: Bridging the Gap
How El Vecino Helps Fill Financial Deserts with Culturally Connected Service Models
by Francisco Arellano, Fractional-COO
Across the U.S., the landscape of community financial services is shifting—dramatically. Over 13,000 local financial service providers have closed their doors in recent years, leaving behind what many now refer to as “financial deserts.” These are regions—often home to immigrant and underbanked communities—where traditional banking and essential services are either inaccessible or missing altogether.
El Vecino was built to respond to this reality.
Founded in 2008, El Vecino has grown into a trusted financial and telecom service center serving over 20,000 active customers monthly across four retail locations in New Jersey. With services ranging from money transfers and bill pay to smartphone sales and prepaid mobile plans, our model is designed specifically for the Hispanic immigrant population—culturally, linguistically, and operationally.
We are now expanding through franchise and licensing partnerships designed to bring this model into underserved communities across the country.
Read more at ELVECINO.NET
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Are Consumers Buried Under Too Much Debt? A New Report Says Maybe Not
Executive Summary
- Total consumer debt has skyrocketed in recent years, but only in nominal terms. Adjusting for inflation produces a very different picture, according to TransUnion.
- In nominal terms, consumer debt ballooned 28% since 2020. But adjusted for inflation, the increase is much lower — closer to 3%.
- In light of the inflation adjustment, TransUnion believes that many consumers could safely take on additional borrowing, opening up opportunity for hungry lenders.
Have you ever read about some new box-office favorite’s opening weekend receipts surpassing an older record, and thought, "But wait — that flick came out 20 years ago. They’re not accounting for inflation"?
As it turns out, there’s been a bit of that going on as growth in consumer debt has been ramping up.
In a recent report, TransUnion says that in spite of the apparent growth in consumer debt, its calculations indicate "a more complex reality."
Read more at The Financial Brand
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