May 19, 2020
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Sen. Jones calls for investigation into repeal of federal payday lending rule

Wednesday, U.S. Senator Doug Jones (D-Alabama) sent a letter calling for Federal Reserve Board Inspector General Mark Bialek to open an investigation into the Consumer Financial Protection Bureau's (CFPB) repeal of the Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule (Payday Rule).

Senator Jones was joined in the letter by Senators Sherrod Brown (D-Ohio), Chris Van Hollen (D-Maryland.), Elizabeth Warren (D-Massachusetts), and Catherine Cortez Masto (D-Nevada).

"Recent press reports detail a CFPB rulemaking process that, if true, flagrantly violates the Administrative Procedure Act's (APA) requirements-in which political appointees exerted improper influence, manipulated or misinterpreted economic research, and overruled career staff to support a predetermined outcome," wrote Senator Jones and his colleagues.

"In light of these disturbing allegations, we ask that you investigate to determine whether the Bureau's process for reconsidering and repealing the 2017 Payday Rule violated the Administrative Procedures Act or other federal laws and regulations," Jones wrote.

Payday Lender Abandons Suit Challenging Eligibility for Paycheck Protection Program Loan. by Burr & Forman

A payday lender recently filed suit against the Small Business Administration ("SBA") in the United States District Court for the District of Columbia relating to its Paycheck Protection Program ("PPP") loan application under the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act"). See Payday Loan, LLC v. United States Small Business Administration, Civil Action No. 1:20-cv-1084 (D.D.C. Apr. 25, 2020) The lender operated twenty-two stores in California that provided lending, check-cashing, money orders, money transmission, and other financial services, while employing approximately 88 employees. After the adoption of the CARES Act, the lender applied for a PPP loan from its SBA lender. The payday lender certified that it was otherwise eligible and adversely affected by the coronavirus and the current economic crisis. Its SBA lender, however, denied its application based upon existing SBA regulations that prohibit "financial business[es] primarily engaged in the business of lending" from participating.
Read more at JD SUPRA


MISSOURI: Advocates fear bill will undo payday lending regulations

LIBERTY, Mo. - Payday loans carry an average interest rate of nearly 400 percent, creating debt traps for consumers.

It's why Liberty voters decided in November to pass limits on lenders. However, a bill on its way to Gov. Mike Parson's desk could undo some of those restrictions, according to some advocates.

The Liberty ballot measure emerged from a petition organized by the Northland Justice Coalition.
"As a city, we had a chance, we thought, to step in and say we think this is unethical and immoral, and we don't want it in our city," said Abby Zavos, one of the organizers.
Read more at KSHB Kansas City

7-Year No-Interest Loans: What It Takes To Sell Cars In A Pandemic

Unemployment is mounting. The economy keeps falling deeper into a recession - or worse. The coronavirus continues to spread. But car sales surprisingly are climbing.

Auto sales tanked in March - to 80% below their expected levels. And they remain well below normal. But while much of the economy continues its free fall, car sales have been on the rise for six straight weeks, according to data from J.D. Power, a marketing data and analytics company.

The steady improvement is fueled, in part, by big incentives for customers who can afford to buy. Dealers are promoting 0% loans for as long as seven years.
Read more at National Public Radio

Dreher Tomkies LLP

Consumer Financial Protection Bureau Outlines Responsibilities of Financial Firms During Pandemic

WASHINGTON, D.C. - The Consumer Financial Protection Bureau (Bureau) today released a statement and FAQs outlining the responsibility of certain financial firms during the pandemic. In the statement, the Bureau outlines the billing error responsibilities of credit card issuers and other open-end non-home secured creditors during the COVID-19 pandemic.

Additionally, the Bureau encourages financial firms to continue to provide the kind of assistance to their communities that many have been providing, such as waiving fees, lowering minimum-balance requirements, and implementing changes in account terms that benefit consumers.

In order to help consumers, the Bureau released two FAQ documents. First, the FAQs remind providers of checking, savings, or prepaid accounts that they can offer consumers immediate relief by changing account terms without advance notice where the change in terms is clearly favorable to the consumer. Read more at CFPB


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We deliver our core solution and customized workflow for a variety of financial verticals. Our personal loan, line-of-credit, mechanics financing, construction loans and student loan installations are state of the art. We have developed point-of-sales portals for student aids office and construction offices to qualify and finance customers in real time.
Read more at ALCHEMY


Debt Collection Lawsuits Have More Than Doubled

How Debt Collectors Are Transforming the Business of State Courts
Lawsuit trends highlight need to modernize civil legal systems

The business of state civil courts has changed over the past three decades. In 1990, a typical civil court docket featured cases with two opposing sides, each with an attorney, most frequently regarding commercial matters and disputes over contracts, injuries, and other harms. The lawyers presented their cases, and the judge, acting as the neutral arbiter, rendered a decision based on those legal and factual arguments.

Thirty years later, that docket is dominated not by cases involving adversaries seeking redress for an injury or business dispute, but rather by cases in which a company represented by an attorney sues an individual, usually without the benefit of legal counsel, for money owed.
Read more at The Pew Charitable Trusts


Payment solutions as they should be: Industry-specific. Merchant focused. Partner-friendly.

Accept all forms of payment and keep the loans flowing
Payliance supports many forms of lending, including installment, marketplace, merchant cash advance, payday and lease-to-own. Payliance consults with you to implement cost-effective, streamlined payments solution that meets the unique specifications of your product design and operational model.

We improve collection recovery rates
At Payliance, we understand the complex regulatory environment that our collection agency clients manage each day. Our knowledge of the accounts receivable management industry allows us to solve challenges of agencies and increase their recovery success.
Read more at PAYLIANCE


Pawn Shops See New Loans Plummet Amid Pandemic

The normal stream of customers heading into EZ Pawn shops has slowed to a trickle.
"People assume that pawn shops thrive in times of desperation and that's just not where we are right now," said Lauren Kaminsky, President of EZ Pawn Corp.

Pawn shops were exempted from Governor Cuomo's order closing all non-essential businesses to stop the spread of the Coronavirus.
EZ Pawn President Lauren Kaminsky says all 15 of her locations are staffed and open, but walk-in business is down dramatically.

Loans are the pawn industry's bread and butter. And while foot traffic is slow, Kaminsky says traffic is brisk on EZ Pawn's new website and app. Online sales are now what's keeping this family business afloat, and they've seen certain items sell better than others during the health crisis.
Read more at SPECTRUM NEWS

Lawmakers look to tweak PPP as loan processing stalls

Backlogs have cleared up. Duplicate applications have been stripped from the process. But backlash from PPP's shortcomings leave Congress pitching new solutions.

Processing of Paycheck Protection Program (PPP) loans has slowed to a comparative crawl, according to Small Business Administration (SBA) data. While the first five days of the program's second round generated $175.7 billion in approvals, the next six days yielded only $11 billion, Bloomberg reported. That leaves about 40% of the second round's $320 billion still available.

The sudden drop-off appears to be the result of a number of factors. First, the initial days saw a glut in processing because of a backlog of applications lenders received since the initial funding ran out April 16. Along with that, batch processing has slowed. The SBA initially allowed banks to submit 15,000 or more applications at a time, then 5,000 or more. The agency is now handling applications individually on a rolling basis, an SBA spokesperson told Bloomberg.
Read more at BANKING DIVE


CFPB to Offer Flexibility for Creditors Working to Resolve Billing Errors During Pandemic

The Consumer Financial Protection Bureau today said it would provide flexibility for creditors to resolve billing errors during the coronavirus pandemic. With many merchants forced to close due to local stay-at-home orders, the bureau acknowledged that these businesses may not be able to respond immediately to creditor inquiries to resolve billing disputes.

Accordingly, the CFPB said that when evaluating creditors' compliance with the billing error resolution timeframes established by Regulation Z, it would "consider the creditor's circumstances and does not intend to cite a violation in an examination or bring an enforcement action against a creditor that takes longer than required by the regulation to resolve a billing error notice." CFPB added that creditors must make "good faith efforts to obtain the necessary information and make a determination as quickly as possible, and complies with all other requirements pending resolution of the error." Read more at BANKING JOURNAL



Alternative Financial Service Providers Association

315 Tuscarora St., Lewiston, NY 14092 


CFPB Releases Final Remittance Rule, Expanding Temporary Protections and Making Them Permanent

Earlier today, the Consumer Financial Protection Bureau (CFPB) issued a final rule regarding remittance transfers, also known as international money transfers, which places requirements on entities that send such transfers on behalf of consumers.

"The term 'remittance transfers' is sometimes used to describe consumer-to-consumer transfers of small amounts of money, often made by immigrants supporting friends and relatives in other countries," the rule reads. "The term may also include, however, consumer-to-business payments of larger amounts, for instance, to pay bills, tuition, or other expenses."

According to American Banker, the rule "expanded and made permanent temporary protections established in an earlier 2013 regulation" and "establishes a safe harbor for banks providing 500 or fewer transfers a year from complying with a requirement that they disclose the price of a remittance transfer, the exact exchange rate, the amount to be delivered, and the date funds are available." The previous exemption threshold was set at 100 transfers.

Institutions making more than 500 transfers per year remain subject to the rule, though a press release issued by the CFPB notes that the exemption "will reduce the burden on over 400 banks and almost 250 credit unions that send a relatively small number of remittances-less than .06 percent of all remittances."