June 4, 2020
AFSPA Partner


AFSPA Partner


Southern states leading coronavirus economic recovery, study finds

US economy is about 55% recovered from COVID-19 lockdown, according to Fivestars

With the worst of the coronavirus lockdowns seemingly over, the U.S. economy is slowly beginning to recover from the unprecedented shock - with Southern states leading the way.

A study published Thursday by Fivestars, a small business marketing and loyalty program platform, found the nation is at a 55 percent recovery rate from the shutdowns, with small business spending up 14 percent from the previous week.

But there's a drastic difference between states that started to navigate reopening their economies earlier than those that have taken a more conservative approach to slowing the spread of the virus. Read more at FOX BUSINESS

Coronavirus causes Wells Fargo to suspend auto loans to most independent dealerships

Bank is one of nation's leading auto lenders for new and used cars

Banking giant Wells Fargo will no longer lend to many independent auto dealerships as a result of the financial risk that has resulted from the coronavirus pandemic.

A spokesperson for Wells Fargo confirmed in an email to FOX Business on Monday that it would only continue working with independent dealers with which it has "deep, long-standing relationships."

"Like lenders across the country, we are doing everything we can to help customers weather the economic impacts of this health crisis, including offering loan deferrals to customers who need them if they've been impacted by COVID-19," the spokesperson said. "As a responsible lender, we also have an obligation to review our business practices in light of the economic uncertainty presented by COVID-19 and have let the majority of our independent dealer customers know that we will suspend accepting applications from them."
Read more at FOX BUSINESS

Dreher Tomkies LLP

Pew Raises Concerns About CFPB Proposal to Rescind Payday Loan Rule

Letter offers data-driven defense of 2017 consumer protections

The Pew Charitable Trusts on May 15, 2019, filed a comment letter with the Consumer Financial Protection Bureau in response to the bureau's notice of proposed rulemaking to rescind the core consumer protections of its final 2017 payday loan rule. Pew's consumer finance team cited its extensive research and analysis of the payday lending marketplace and urged the bureau to withdraw its plan to eliminate the rule's critical affordability safeguards

Attached to this letter are comments from The Pew Charitable Trusts regarding the Consumer Financial Protection Bureau's proposal to eliminate the ability-to-repay safeguards for small-dollar loans it finalized in 2017 ("2019 proposal"). Based on extensive research conducted over more than eight years, Pew strongly supports efforts to reform the market for payday and similar loans, including the Bureau's 2017 rule.
Read more at The Pew Charitable Trusts.

U.S. Senate passes bill lengthening coronavirus small-business loan terms

WASHINGTON (Reuters) - The U.S. Senate unanimously approved legislation on Wednesday giving small businesses up to 24 weeks to use Paycheck Protection Program loans created during the coronavirus pandemic, up from the current eight-week deadline.

The legislation, already passed by the House of Representatives, now goes to President Donald Trump to sign into law. The program was created in March to support small businesses during the pandemic and encourage them to retain their employees.

Under the PPP program, loans for restaurants, hotels and other small businesses would convert into federal grants if recipients adhere to a set of conditions, including spending the loan amount within the required time.
Read more at REUTERS



Navigating the 2020 Pandemic Effects on the Lending Industry: Part 2

We continue our three-part series examining the massive changes in lending caused by the largest global pandemic in living memory. In Part 2, we examine the risk and decisions businesses must take in order to adapt and survive through any crisis.

The Fear of Ignorance: A Prescriptive Solution. by Thomas Brandenburger, ValidiFI Chief Data Scientist

Any endeavor worth pursuing requires taking risks. At its core, risk is merely uncertainty. The avoidance of risk is not necessarily the goal. Understanding the magnitude, variability, and source of that risk becomes the catalyst to decision making. But when risk enters new territories previously unseen, the unknown and unmeasurable create fear. This fear is driven by ignorance. Ignorance gets a bad rap. However, it's simply the lack of knowing something. It can be cured, so long as it is recognized, and necessary action taken. It is this lack of information, necessary for making good decisions, that creates fear. The fear that is created is both necessary and useful rather than something to be feared.



Alchemy's Lending Platform is purpose-built to specifically address the needs of today's consumers as well as enabling automation and real-time underwriting for Banks, Speciality Financing firms and FinTech startups.

Our goal is to become the operating system to launch any financial products for banks and FinTech alike. Our lending vertical solutions are especially powerful with unique workflows that cater to student lending and construction loans. Deep lending domain knowledge with lending and analytics know how is what our clients love the most about us.

Alchemy's lending platform has two major benefits. Our lending operating system has users in unsecured installment loans, point-of-sale installs such as mechanic shop financing and construction loans:
  • A true end-to-end lending experience - We have developed a true end-to-end lending experience for our clients. From the website or mobile app all the way to loan management and payment processing. The entire platform is designed and built from the ground up. Our code base is developed with the latest program language and we have integrations with a variety of credit bureaus as well as with banks.
  • A true white labelled experience - Alchemy's vision is to power banks and financial institutions and help them quickly launch credit products. We always white label our solution behind our clients in a discrete way. There is now "powered by" or fine print, our client operates their businesses with their brand. Alchemy lending platform becomes the work horse behind the scenes.


Tech companies team up to help small businesses stay open

Coronavirus causes PayPal, Salesforce, GoDaddy, Slack to help

Well-known technology companies have joined together to create a website called #OpenWeStand with the goal to gather "resources, inspiration and connection to other everyday entrepreneurs with creative solutions to keep their business open, even if their doors are closed due to COVID-19."

Resources like business strategies, communication, community engagement and maintaining customer loyalty are listed on the website, which is a partnership between companies like PayPal, Salesforce and Slack.

"Lots of big businesses have great offers for small business, but where should small businesses go to find those offers?" GoDaddy CEO Aman Bhutani said to FOX Business' Liz Claman during "The Claman Countdown" on Tuesday. "And by the way, how should they find out about it?"
Read more at FOX BUSINESS

Virginia's biggest payday loan firm is leaving as state crackdown looms

Virginia's largest payday lender is pulling out of the state ahead of stricter new regulations that will take effect next year.

Advance America surrendered its payday and title loan licenses last week, said Joe Face, commissioner of the Virginia Bureau of Financial Institutions.

So did Express Check Advance, which shares a South Carolina headquarters with Advance America.

A payday loan is a short-term advance of up to $500, secured by a post-dated check for a higher amount. That surcharge and the interest lenders have been allowed to charge has amounted to the equivalent of an annual interest rate of as much as 818%, Bureau of Financial Institutions data show. The rate averaged 251% in 2018, the latest year for which data is available.
Read more at THE DAILY PRESS


Rise of Cashless Retailers Problematic for Some Consumers

Cash remains important payment option for many

Restaurants, stores, and stadiums around the country have stopped accepting cash as payment and instead are requiring patrons to pay with cards or digital devices, although some have already abandoned the practice in response to a public backlash.

Businesses that have gone cashless say they did so in response to concerns about security (theft of cash), a desire for greater efficiency (faster transactions), and consumer demand as most of their clientele pays electronically. Opponents, however, cite the possible discriminatory impact of this practice, saying that it violates the Civil Rights Act because unbanked consumers-meaning those who do not have a bank account-are more likely to be members of minority groups.

According to the Federal Deposit Insurance Corp., just 6.5 percent of households are unbanked, but research by Pew shows that these Americans are more likely than those with bank accounts to pay primarily with cash. These households also tend to have the fewest payment alternatives.
Read more at The Pew Charitable Trusts

Providing Financial Services to Employees Is a Win-Win

Today's global events are forcing employers to rethink their role in supporting their workers, especially in terms of pay. ADP Research Institute's Evolution of Pay Research shows frequently rely on their employers to offer the guidance and resources needed to help secure their financial futures by aiding in better personal financial decisions. As these expectations become an increasingly important focus of employees, employers are quickly embracing models that allow for greater pay flexibility and personal-finance assistance. The evolution is not just good for the workers - empowering a more financially confident workforce will drive greater overall business outcomes.

Greater Pay Flexibility
Times like this offer a stark example of the need for greater pay flexibility. With restricted business operations, workers need easy access to their earnings. Understandably, they also demand speed that matches the urgency of the moment. Given the diverse demographics of the workforce, it's up to employers to broaden their pay offerings.



Alternative Financial Service Providers Association

315 Tuscarora St., Lewiston, NY 14092