March 31, 2020
AFSPA Partner

CFSA Encouraging Members to Extend Flexibility in Small-Dollar Loan Repayment During COVID-19

As businesses across the country temporarily close stores, reduce employee hours or implement other responsive measures to the growing coronavirus (COVID-19) pandemic, the Community Financial Services Association of America (CFSA) is encouraging its members to provide greater flexibility to customers who may be unable to repay their small-dollar loans in a timely manner. This includes greater leniency in collecting past due accounts, restructuring or suspending loan payments and for certain loans offering the Extended Payment Plan (EPP), a provision of CFSA's Best Practices. CFSA members are continuing to serve customers across the United States during these challenging times, having been deemed essential businesses due to the important role they play in providing access to credit.

"We recognize that some small-dollar loan customers may undergo financial hardships during this pandemic, and therefore, we are encouraging our members to go above and beyond our association's Best Practices and give customers experiencing hardships more time to repay their loans during this period of uncertainty," said CFSA Chairman D. Lynn DeVault. "The health and safety of our member companies' customers, employees, and their families is our highest priority during these unprecedented times, and CFSA will continue to serve as a resource for its members as they work to serve their customers and communities across the nation."

The EPP offers customers the option of repaying loans over a longer period of time if they are unable to do so under the original contract terms, unless otherwise not allowed by state law. In response to the pandemic, CFSA is also encouraging its members to consider further leniency in collecting past due accounts and make available active toll-free consumer hotlines and electronic platforms so that consumers can easily communicate their questions, concerns and complaints.

CFSA members are also taking necessary precautions to ensure the health and safety of their customers, employees and communities. This has included implementing enhanced cleaning measures at storefront locations, restricting employee travel, encouraging good hygiene, as well as practicing social distancing at our stores and headquarters. Many member companies also offer loans and credit products online and are reminding customers of those additional options in the states where online lending is permitted.

Fed chair Powell says will provide nearly unlimited lending

Jerome Powell says the Federal Reserve would provide essentially unlimited lending to support the economy as long as it is damaged by the viral outbreak

WASHINGTON -- Jerome Powell says the Federal Reserve would provide essentially unlimited lending to support the economy as long as it is damaged by the viral outbreak.

In an interview Thursday morning on NBC's "Today" show, the Fed chair said the bank's efforts are focused on helping the economy recover quickly once the threat from the virus has passed.

Powell also acknowledged that the economy "may well be" in a recession, but said that this is a unique downturn in that it was caused by efforts to control the disease. The economy itself was strong before the outbreak began, he said.
Read more at ABC NEWS

AFSPA Partner


Short-term loans are lifelines for many Americans

America's economic shutdown, with its layoffs and business failures, could wipe out 5 to 6 million jobs in March alone, according to at least one estimate.

Many people will have to take a pay cut or get their hours reduced. Many who don't lose their jobs will have to live with salary cuts or reduced hours. Those at the bottom of the economic ladder will be hurt the most and are likely to find themselves in circumstances in which their income can't meet sudden financial needs. Some will be able to replace their lost income by using their checking accounts' overdraft protection, pulling cash advances from their credit cards, tapping into savings, taking out personal loans, or borrowing from family or friends.

But not everyone has access to those alternatives. In a country where, according to the Federal Reserve Bank, nearly 40% of the adults don't have the finances to cover a $400 emergency, and, says the Federal Deposit Insurance Corporation, more than 20 million live in unbanked households, the only option is an unsecured small-dollar short-term loan.


Free Tools, Resources, and Financial Help for Business Owners Hit by Covid-19
UPDATED (March 29)

Several companies are extending a hand to small-business owners navigating the coronavirus crisis.

A growing number of companies are offering their online tools, classes, and resources at no cost in response to the impact on small-business owners from the coronavirus. Below is a list that Inc. is curating and continuously updating.

Note: The federal government and several states also are stepping up to offer emergency financial resources for small businesses.

Ad credits and grants

  • Google is donating more than $800 million to support small businesses, health organizations, governments, and health workers impacted by Covid-19. The amount includes $340 million in Google Ads credits for small and midsize businesses with active accounts in the past year.
  • Telecom giant Verizon is donating $2.5 million to nonprofit Local Initiatives Support Corporation for its Small Business Covid-19 Recovery Fund, which will use the funds to provide grants of up to $10,000 to struggling businesses.
  • Amazon launched a $5 million Neighborhood Small Business Relief Fund to provide cash grants to small businesses in and around the Seattle area that are impacted by Covid-19.

Read more at Inc.




WASHINGTON, D.C. - The Consumer Financial Protection Bureau (Bureau) today announced that it is providing needed flexibility to enable financial companies to work with customers in need as they respond to the COVID-19 pandemic. The Bureau is postponing some data collections from industry on Bureau-related rules to allow companies to focus on responding to consumers in need and making changes to its supervisory activities to account for operational challenges at regulated entities.

"As consumers seek temporary relief from lenders, the pandemic is impacting the operations of financial companies that are eager to help their customers during this unprecedented time," said Director Kathleen L. Kraninger. "Our actions today are temporary and targeted to support consumers by allowing financial companies to focus their resources on assisting consumers.

"The Bureau, along with our state and federal partners, have released prior guidance encouraging financial institutions to work constructively with borrowers and other customers affected by COVID-19 to meet their financial needs. We will continue to issue additional guidance and policies to facilitate the ongoing collaborative relationship between companies and their customers during this time," concluded Director Kraninger.
Read more at Consumer Financial Protection Bureau



Open Letter from Our CEO: We Want to Help Lenders

Dear Lenders,

The global COVID-19 health and economic crisis is changing hourly. We believe we can only get through this together and we want to try and help in small ways.

Individuals and businesses are already feeling financial shortfalls. Lenders like you are going to need to make decisions about a growing number of individuals within the context of a volatile and uncertain market. We can provide expertise on what tactics you may consider to help navigate this economic climate.

We can also provide some insight into how using tech, analytics and data can help you in making tough decisions. And if our solutions are a fit for you*, we're extending our services on a trial basis, to help ease some of what is going to be a tough burden for all of us.

Interested in speaking with one of our experts to discuss ideas for navigating through this, what technology can do to help, or simply want a sounding board for business decisions?


Regulators Issue Coronavirus Guidance on Small-Dollar Lending: Instant Reaction

Federal agencies are currently considering longer-term guidance for banks on the issue

Financial regulators on Thursday urged banks to offer small-dollar loans, anticipating a growing need during the coronavirus pandemic.

Most banks have pulled back from offering small-dollar products to consumers, citing 2013 guidance from the Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency that discouraged the practice. The agencies and the Federal Reserve Board have discussed issuing new guidance that encourages banks to re-enter the market, and agency staff said that more permanent and detailed guidance is still in the works.

In a new interagency statement released Thursday, the latest from bank regulators as they react to the coronavirus crisis, the Fed, FDIC, OCC, National Credit Union Administration and Consumer Financial Protection Bureau reassured banks that they would "favorably consider" banks offering short-term unsecured credit products, which could include open-end lines of credit, closed-end installment loans or appropriately structured single payment loans.


This Is How Experts Think Coronavirus Will Change The World Over The Next 18 Months

We are in lockdown.

Supermarket shelves are stripped bare. Flights are grounded. Workers have been laid off; furloughed; transformed into primary school teachers. A Conservative government has nationalised the railways and is paying people not to work. And this is still only week two. In less than a fortnight, Britain has experienced the kind of social and political upheaval that normally only comes when you guillotine some royals, or storm a winter palace. But is this a brief moment of national solidarity, or a 'new normal'?

That all depends on how long the coronavirus crisis lasts. Experts believe a vaccine for Covid-19 (the disease caused by the Sars-CoV-2 virus) is still at least 18 months away, which makes Donald Trump's promises that the US will "reopen" in three weeks seem optimistic at best. In the UK, the more likely reality was laid out in a report by researchers at Imperial College London, which estimated that elements of the new normal - social distancing, self-isolation, rolling lockdowns - could last until September 2021. So what's likely to happen as the coronavirus crisis continues?
Read more at YAHOO



Personal Loan Demand and COVID-19. What Now? by Kristen Hoyman.

Our appetite for borrowing only continues to grow, Coronavirus or not.

Debt levels are rising despite what has been eleven years of favorable economic performance. That was before the Coronavirus outbreak. Borrowing demand, however, is likely to remain strong, if not just a little delayed, despite the forced global slowdown.

Credit cards are a big piece of that debt. After home, car, and student loans, credit cards are the next biggest debt category (see the blue in the chart below). With rising credit card balances comes more interest in debt consolidation loans provided by fintech lenders like Lending Club, Prosper, or SoFi.

Based on an Experian study from 2019, The Motley Fool reports personal loan debt is the fastest-growing type of debt. Personal loan debt growth of 12% is double the growth of the next biggest category, credit card debt. The average borrower has a $16,000 loan balance.

The need for personal loans and debt consolidation will continue to exist, virus or not. In fact, the demand could grow due to the new economic environment.
Read more at REPAY

Dreher Tomkies LLP

Checks Won't Cut It: Getting COVID-19 Relief To The Most Vulnerable

In all likelihood, the federal government will be sending out tens of millions of paper checks in the coming weeks and months to those who qualify for aid under the Coronavirus Aid, Relief, and Economic Security Act.

The United States is one of the only industrialized nations that still uses checks, despite a spate of major national disasters in the last decade that demonstrated the challenges of distributing, depositing and cashing checks when roads are flooded and people's homes have been destroyed. Given the staggering number of people affected by the COVID-19 pandemic and who are under shelter in place orders, the challenges will be greatly exacerbated in this crisis.

Once again, the greatest burdens will be shouldered by the most vulnerable among us, when instead we should be doing everything to give them a leg up. It is incumbent on government, business leaders and community organizations to do everything possible to ensure they are not left out.
Read more at FORBES


13 steps to take if you've lost your job due to the coronavirus crisis

Millions of Americans are out of work, businesses are shuttering and economic activity is coming to a near grinding halt. In a matter of days, the novel coronavirus has cratered the U.S. job market, reversing its reign as the best in decades to now the worst.

The Treasury department said unemployment could skyrocket to 20 percent, while St. Louis Fed President Jim Bullard said joblessness could soar to 30 percent - higher than during the heart of the Great Depression.

"It is quite clear that we're facing a toll of furloughs and job cuts, which are unprecedented in recent American history," says Mark Hamrick, Bankrate's senior economic analyst and Washington bureau chief. "We are bracing for ugly numbers."

If you've faced job loss because of the coronavirus, here are 13 steps you should consider taking to help lessen the financial blow and prepare you to bounce back once the economy recovers.
Read more at BANKRATE


MICHIGAN: Longtime industry could help Michiganders get cash during coronavirus crisis

The novel coronavirus pandemic has pushed people indoors, closed schools and caused many businesses - essential and non-essential alike - to shutter offices and lay off employees, throwing the economy for a loop.

nd as people struggle through the hardships caused by the COVID-19 virus, one long-time industry is once again a practicality for many:

The pawn shop.

For people who are unemployed,face unemployment, or are without credit or financing, pawn shops provide a much needed service, helping them get the money they need for everyday essentials by selling or loaning valuable goods such as jewelry, electronics, and power tools.


Follow these steps to keep your personal finances in check during the coronavirus pandemic

The coronavirus has disrupted life throughout America, but various common-sense tips can help keep your finances under control.

Fortunately, most of the following checklist items are reasonably easy to implement, without requiring much heavy lifting. Many are actions you should have been taking anyway, but now they're more urgent.

If you just lost your job or expect that to happen soon, a couple of these tips might not be practical. But most of the suggestions below don't require much income and, in fact, could help cut expenses.

Build up an emergency cash fund
Read more at AZCENTRAL


Alternative Financial Service Providers Association

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