ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
December 3, 2020
The Gateway For Payroll Data
SBA releases borrower data on EIDL, smaller PPP loans

UPDATE: Dec. 2, 2020: The Small Business Administration (SBA) on Tuesday disclosed the names, addresses and precise loan amounts for each Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) borrower.

Judge James Boasberg of the U.S. District Court for the District of Columbia last week ordered the agency to release the information by Dec. 1, rejecting the SBA’s request for a full stay.

The public "maintains an urgent and immediate interest in assessing the results of SBA’s initial effort at administering a massive small-business relief package and extracting lessons where possible — both to inform a critical, ongoing federal debate and to remedy failures in the loan-disbursement process moving forward,”" Boasberg wrote in his order, according to The Wall Street Journal.
Lending as a Service
Auto Repossessions Likely to Rise in 2021 as COVID-19 Pandemic Goes On

With no new federal aid on the horizon and the pandemic ongoing, experts think many more vehicles could be repo'd. If that's you, start talking to your lender now.

Experts who pay attention to auto loans see trouble on the horizon and think repo men and women will be busy in the new year.
Coronavirus era federal stimulus payments and unemployment benefits are mostly finished, and there's no hint that we'll get another aid package before January 20.
If you think you might be facing repossession, the FTC has some advice on how to contact your lender as well as other suggestions, principally: Don't do nothing.

Paving the Payments Future
CFPB California Style

Almost a decade after U.S. Senator Elizabeth Warren (D-Mass.) declared that the federal Consumer Financial Protection Bureau (CFPB) would become a new “cop on the beat” protecting consumers of financial products and services, California Governor Gavin Newsom signed a law creating a new state regulatory agency that some commentators have dubbed the “CFPB California style.”

Effective January 2021, the California Consumer Financial Protection Law establishes a state Department of Financial Protection and Innovation (DFPI) aimed at protecting consumers of financial products and services from predatory business practices. According to Manuel P. Alvarez, commissioner of the newly created DFPI, the agency will address “an increase in predatory financial lending and scams” due to “the economic downturn induced by the COVID-19 pandemic.” He claims that the DFPI will be able to “increase consumer protections without imposing undue burdens on honest and fair operators.”
COVID-19 paid leave tax credits for Small and Midsize businesses

Small and midsize employers can claim two NEW refundable payroll tax credits.

The paid sick leave credit and the paid family leave credit are designed to immediately and fully reimburse eligible employers for the cost of providing COVID-19 related leave to their employees.

GM's lending arm could apply for ILC charter this month

  • GM's lending arm, General Motors Financial Company, is discussing plans to apply for an industrial loan company (ILC) charter as early as this month, The Wall Street Journal reported, citing unnamed sources.
  • If the application is approved, it would mark a return to the ILC format for the car maker. GM's previous lending arm, GMAC, held an ILC charter until 2008, when the Federal Reserve gave emergency approval for it to become a bank holding company amid a trio of government bailouts worth $17.2 billion.
  • GM Financial would join a groundswell of nonbanks, including investment company Edward Jones and e-commerce giant Rakuten, that have applied for ILC charters over the past months. The charter has drawn flak from trade groups and lawmakers who say it allows companies a way to provide banking services without Federal Reserve oversight.

Fed, Treasury to extend 4 lending facilities to March 31

The Federal Reserve and the Treasury Department agreed to extend four emergency lending facilities that were scheduled to expire by the end of the year, the two agencies announced Monday.

The Fed’s Commercial Paper Funding Facility, Money Market Mutual Fund Liquidity Facility, the Primary Dealer Credit Facility and the Paycheck Protection Program Liquidity Facility, which were set to expire on or around Dec. 31, have been extended through March 31.

The decision to extend the deadline follows a recent rift between the two agencies regarding unused coronavirus-related emergency funds and comes ahead of Fed Chair Jerome Powell and Treasury Secretary Steven Mnuchin’s scheduled testimony before Congress this week as part of mandated updates on CARES Act funding.
Aaron's (AAN) Moves to Buy: Rationale Behind the Upgrade

Aaron's (AAN) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #2 (Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.

The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.

Since a changing earnings picture is a powerful factor influencing near-term stock price movements, the Zacks rating system is very useful for individual investors. They may find it difficult to make decisions based on rating upgrades by Wall Street analysts, as these are mostly driven by subjective factors that are hard to see and measure in real time.
From the CFPB: What is a payday loan?

While there is no set definition of a payday loan, it is usually a short-term, high cost loan, generally for $500 or less, that is typically due on your next payday. Depending on your state law, payday loans may be available through storefront payday lenders or online.
Some common features of a payday loan:

The loans are for small amounts, and many states set a limit on payday loan size. $500 is a common loan limit although limits range above and below this amount.
A payday loan is usually repaid in a single payment on the borrower’s next payday, or when income is received from another source such as a pension or Social Security. The due date is typically two to four weeks from the date the loan was made. The specific due date is set in the payday loan agreement.

It’s easy to assume pawnshops are doing great in the pandemic. It’s also wrong.

It’s not just about the guns and gold: Loans are at the core of the pawn business.

Perry Lewin has been in the pawn industry for 28 years, but he’s never quite seen a year like this one. Sales have skyrocketed at his store, Decatur Jewelry and Antiques, in central Illinois. Early on in the pandemic, people were scooping up TVs, guitars, gaming systems, laptops, whatever they could to stay occupied and educated at home.

“We couldn’t keep a bicycle in the stock to save our life,” Lewin said. Tools were flying off the shelves, as many households decided it was the “perfect time for a honey-do list.” He estimates his gun and ammunition sales are up by 500 percent. “You know what it was like back in March and April, scared as hell,” he said.
For 42 million student loan borrowers, monthly payments will resume in January

Millions of student loan borrowers have just one month left to figure out how they’re going to resume monthly payments on their education debt while the coronavirus pandemic is still crushing the economy.

Monthly payments for most federal student loans have been on pause since March, when the CARES Act gave 42 million borrowers relief during the coronavirus pandemic. For the more than 37 million of those borrowers that haven’t made a payment in months, the unprecedented break is coming to an end. The moratorium will lapse in December, meaning payments will resume again in January unless another extension comes soon.
Rent-A-Center, Inc. (NASDAQ:RCII) Expected to Post Quarterly Sales of $707.11 Million

Analysts expect that Rent-A-Center, Inc. (NASDAQ:RCII) will post $707.11 million in sales for the current quarter, Zacks Investment Research reports. Four analysts have issued estimates for Rent-A-Center's earnings, with the lowest sales estimate coming in at $702.61 million and the highest estimate coming in at $710.90 million. Rent-A-Center reported sales of $667.86 million in the same quarter last year, which would suggest a positive year over year growth rate of 5.9%. The company is scheduled to issue its next quarterly earnings results on Monday, February 22nd.

According to Zacks, analysts expect that Rent-A-Center will report full-year sales of $2.80 billion for the current year, with estimates ranging from $2.80 billion to $2.81 billion. For the next year, analysts anticipate that the firm will report sales of $2.96 billion, with estimates ranging from $2.91 billion to $3.04 billion. Zacks Investment Research's sales calculations are an average based on a survey of sell-side research firms that cover Rent-A-Center.
Here’s what to look out for in cybersecurity in 2021

When we look back in the annals of history, hundreds of years from now, 2020 will not be a high point. Between political upheaval, a global pandemic killing millions, and the knock-on effects on the economy and society, it has not been an easy year. Cybersecurity has also struggled, as the work from home revolution leaves us all susceptible to attacks from hackers.

But will 2021 prove to be a new start in more ways than one, or will it simply be a continuation of the struggles we’ve encountered throughout 2020 in the world of cybersecurity? For one analyst firm, it seems they believe the risks will be less revolutionary, and more evolutionary.

“Amid the continued shift to remote working, we’re likely to see this threat continue to be successful as targets are unable to quickly check with colleagues about dodgy-looking emails, are more likely to click on dangerous links or transfer money when requested by someone seemingly legitimate, like a trusted colleague or boss.”
ALTERNATIVE FINANCIAL SERVICE PROVIDERS ASSOCIATION
Alternative Financial Service Providers Association
757.737.4088
315 Tuscarora St., Lewiston, NY 14092