August 23, 2018

FactorTrust®, a TransUnion company, provides alternative credit data, analytics and risk scoring information to help lenders make more informed decisions.

Senate committee expected to narrowly approve Trump pick to lead CFPB

It's unclear if the full Senate will vote on Kathy Kraninger's nomination

The Senate Banking Committee on Thursday is expected to narrowly confirm Kathy Kraninger on party lines to head up the Consumer Financial Protection Bureau.

Kraninger is one of six nominations the committee will consider, including Dino Falaschetti to lead the Office of Financial Research, Kimberly Reed to be president of the Export-Import Bank, and Elad Roisman to be a commissioner at the Securities and Exchange Commission.

Kraninger's is the most controversial, however. The nominee is currently associate director at the Office of Management and Budget, where she works for Mick Mulvaney, who also is the acting director of the CFPB.

At a hearing in July, Democrats attacked her for her role in the administration's child separation policy - Kraninger maintains she had no role in developing it and declined to characterize her advice - as well as her lack of consumer protection experience. Read more at MARKETWATCH

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Lawmakers Charge Trump Administration Easing Up on Payday Lenders to Troops

All 47 Democrats in the Senate and the two Independents who usually vote with them have called on the Trump administration to drop proposed rules changes that they argue would ease oversight of predatory payday lenders.

In a letter Wednesday, the senators, including the ranking members of the Banking, Armed Services and Veterans Affairs Committees, said that gutting provisions of the Military Lending Act of 2006 could limit reviews of a lender's qualifications and expose troops to exorbitant interest rates.

The changes would "make it easier for unscrupulous lenders to target U.S. troops and rip off military families," the lawmakers said in the letter to White House Office of Management and Budget (OMB) Director Mick Mulvaney, who also is acting director of the Consumer Financial Protection Board (CFPB).

The letter was prompted by reports from National Public Radio and The New York Times that Mulvaney is considering eliminating routine examinations by CFPB of firms for compliance with the Military Lending Act. Read more at MILITARY.COM

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

Here's why you credit score may suddenly be on the rise

Americans have witnessed a wholesale rise in their credit scores since new rules went into effect last year forcing the credit bureaus to remove certain collection items for your credit report.

But the even better news is you don't have to wait for rule changes to come to the rescue if you know how to raise your score by yourself!

New York Fed: 11-point increase in average credit score
Our nation's consumers have been witnessing a steady stream of changes over the past year that have bumped their scores up little by little, in many cases.

We told you how Equifax, Experian and TransUnion removed most tax liens and civil judgments from consumer credit files in July 2017. Then in April of this year, the three main credit bureaus took it a step further and decided to remove all tax liens.

Simultaneously, the bureaus also have been removing certain collection items from credit reports over the past year under terms of the National Credit Assistance Plan (NCAP) that they agreed to.

The provisions of NCAP really get down to the nitty-gritty of what could be fouling up your credit. For example, if there have been any unpaid gym memberships, library fines or traffic tickets lurking in your life, there's good news for you:   Read more at WSBTV.COM

With PRBC alternative credit scoring you can now assess the creditworthiness and ability to pay of the 100 million people who have no traditional credit history on file with the traditional credit houses.

Financial regulation in the US: as the world turns and the pendulum swings

"Money makes the world go round" said the stars of the 1966 musical Cabaret. But who makes the money go round? Bankers and other financial professionals. Yet financial professionals are not always appreciated. A May 2017 CATO survey of 2000 Americans found that 48 percent have "hardly any confidence" in financial institutions. At the same time, another 48 percent have "hardly any confidence" in financial regulations. Similarly-split views were featured in Pew and Gallup surveys conducted in late 2017 and in a survey of bank reputations released in June 2018 by the American Banker magazine and the Reputation Institute.

The two opposing views shown in the CATO survey and others are perfectly balanced around a neutral fulcrum of the rare folks who have no opinion on the matter. To put it bluntly, Americans either hate banks and love regulations, or hate regulations and love banks. No wonder we have a giant 'pendulum' that swings back and forth between regulation and deregulation of financial institutions in America.

This pendulum swing generally tracks with political power. Regulation tends to be stronger when Washington is under Democratic control, while deregulation tends to be stronger when Washington is under Republican control. Read more at FINANCIER WORLDWIDE

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Alternative Finance Market to Grow 21% by 2022

According to a report from Technavio, the global alternative finance market will grow more than 21% by 2022. Sources of alternative finance include peer-to-peer lending, crowdfunding and invoice trading. Despite the projected growth, the momentum of the market is expected to decelerate due to a decline in year-over-year gains.

A key factor driving the growth of the market is the speed and ease with which customers can obtain credit. Alternative finance provides quick and easy access to credit unlike traditional financial institutions, which may take more than a day to complete the paperwork for a loan application. Several banks have policies that restrict them from even providing loans to certain businesses such as restaurants and clinics. Alternative finance caters to such businesses and is attractive due to expedited credit practices.

The alternative finance market in several Asian countries has grown significantly in the past five years. Many SMEs in developing countries such as China, Hong Kong, Malaysia, Indonesia, India and the Philippines lack access to traditional financing sources, which has increased the demand for alternative financial services and platforms. In these developing countries in Asia, SMEs play an important role in driving the growth of the economy and account for nearly half of the total employment and national income. Read more at MONITOR DAILY

National Debt Holdings
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.

Cash is a miracle. So why are more businesses refusing it?

For years, small businesses have asked customers to pay cash, set credit card minimums, or added a surcharge onto card transactions, in an effort to defray the premiums imposed by companies like Mastercard and Visa. Now, an increasing number of businesses are doing the opposite. Head out of Slate's offices for lunch and you might wind up at Dos Toros, a local burrito minichain; for coffee you might pick Devoción, a Colombian-born coffeehouse with an airy storefront. In either case, you'd be confronted with the same demand: Pay with plastic.

Stores are eliminating cash registers and coin rolls in pursuit of what they say is a safer, more streamlined payment process-and one that most of their customers want to use anyway. At Dos Toros, co-founder Leo Kremer said that more than half of the shop's customers used cash when its first location opened in Manhattan in 2009. By the beginning of this year, that number had fallen to just 15 percent. At that point, the various hassles of dealing with cash-employee training, banking fees, armored-truck pickups, and the occasional robbery-outweighed the cost of credit card fees on those transactions. The shift wound up being more or less revenue-neutral, Kremer said, but saved a lot of time and trouble. Dos Toros' New York locations have been fully cash-free since the winter.

And what about customers who don't carry a card? "You agonize over that," Kremer said. "After talking to the team and absorbing the flow at the register, we felt like almost everyone who used cash had a card. It just hasn't been an issue." Read more at SLATE.COM
Decision Cloud is a black box platform, which allows users to build decision waterfalls, utilizing Insight's services, as well as a plethora of third party vendor services.

CFPB And Trade Groups File Status Report In Industry Lawsuit Challenging Payday Loan Rule. by Alan S. Kaplinsky

On August 7, the Texas federal court hearing the lawsuit filed by two trade groups challenging the CFPB's final payday/auto title/high-rate installment loan rule (Payday Rule) denied the trade groups' motion for reconsideration. The motion asked the court to reconsider its June 12 order granting a stay of the lawsuit but denying a stay of the Payday Rule's August 19, 2019 compliance date.

Last Friday, the trade groups and the CFPB filed a Joint Status Report with the court. The report restates the CFPB's intention to engage in a rulemaking to reconsider the Payday Rule and indicates that the Bureau "is engaged in ongoing work to prepare a notice of rulemaking to reconsider the Payday Rule and expects to issue that notice of proposed rulemaking by early 2019." The trade groups also "represent that Plaintiffs' members continue to face substantial costs in preparing for compliance with the Payday Rule."

It is disappointing that the Joint Status Report does not reveal whether the CFPB plans to issue a proposal to delay the Payday Rule's compliance date pursuant to the Administrative Procedure Act's notice-and-comment procedures. In light of the court's denial of the reconsideration motion, we had expressed our hope that the CFPB would move quickly to issue such a proposal to give the Bureau additional time to revisit the Payday Rule and engage in substantive rulemaking. We remain hopeful that the CFPB will soon issue a proposal to delay the compliance date.

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.

Three Ways We're Inching Toward Financial Inclusion

Too many people are being left behind, excluded from the benefits of capitalism. One unintended consequence of this is the rise of "populist" parties at the extremes of both Left and Right. "Populism" has become a catchall shorthand for anything the "included" disagree with. The irony, though, is that populist movements advocate socially divisive rather than genuinely popular policies.

Inclusive Capitalism addresses this by analyzing who benefits from inclusion and who is excluded or left behind. There have been at least 30 years of well-meaning initiatives on financial inclusion, but for the most part, they haven't delivered on their promise.

Solutions exist where technology and behavioral economics overlap, specifically the three "A's": apps, automatic enrollment, and assets. We can use our obsession with mobile technology for our own financial benefit. We can use auto-enrollment to save and deliver financial inclusion by default, whilst boosting the individual's balance sheet to reinforce resilience and inclusion. Read more at FORBES

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3 simple ways to overcome financial fragility

Can you handle an immediate $400 emergency expense? Are you able to come up with $2,000 in 30 days? If your answer is no, you are probably financially fragile. The National Endowment for Financial Education (NEFE) reports that nearly two out of five working-age Americans fall into this category. This means an unexpected medical bill, parking ticket or car repair can trigger a chain of financial losses.

"The majority of people who are financially fragile are in the lower income bracket," says Billy Hensley, president and chief executive officer of NEFE. "But actually, one in five Americans who we consider high income, those that make $75,000 to $100,000 a year, are also financially fragile. It's high debt. It's lack of assets. It's low financial literacy and the lack of understanding of how financial decision making works. When you put all of those together, that's really what creates fragility for the average American home."

If you live on the financial edge, Hensley says there are three things you can do to improve your situation. Read more at FOX BUSINESS


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