April 18, 2019
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The war is over and the bankers have won

The House Banking Committee held a hearing on Wednesday to discuss the financial stability of the nation's biggest banks. It requested the presence of the top CEOs to field questions on their finances. However, virtually no queries were posed on financial stability in a hearing that lasted possibly five hours or more.

What emerged instead was a series of questions on multiple subjects with no unifying theme. What emerged was a clear understanding that there would be no meaningful banking legislation for the foreseeable future. Instead the bureaucrats in the banking regulatory sector would be "running" the banks. These are men and women who either had been bankers or who are strong supporters of the industry.

The banks and their investors had won. The only banking news that is likely to emanate from Washington, for the next few years, is going to be positive for the industry. The stringent regulations that have been restricting banking for a decade are likely to be loosened. From my perspective, this will be good for the nation and its economy.

Ten years ago
A decade earlier, there was a similar hearing held in Congress. At that hearing the legislators were driven by fury; fury driven by the belief that the banks had just caused the biggest financial crisis since the Great Depression and that they had to pay for doing this. What emerged that time was the Dodd Frank Act; thousands of new rules and regulations; and hundreds of billions of dollars in fines. In essence, on a de facto basis the banks were nationalized. Read more at CNBC

Lending as a Service

Online Lenders Prepare For A Recession

Online lenders in the U.S. including LendingClub, Kabbage, and Avant are gearing up for a slowdown in the economy and are taking a look at their risk exposure as they prepare for what they see as the inevitable.

Reuters, citing interviews with half a dozen online lenders, reported the companies are worried that a recession could hit the U.S. economy, bringing with it an increase in credit losses, the potential for the need for liquidity and higher funding costs. It would be a test for many of the online lenders that haven't lived through an economic downturn. After all, many of the online lenders were born out of the Great Recession and have never had to deal with downturns like the traditional banks. Traditional banks have lower costs and a higher number of deposits, making it cheaper to lend money. These online lenders also underwrite loans differently, relying on less traditional data points to approve loans. Those underwriting methods haven't been tested yet when the economy is in a slowdown.

"This is very top of mind for us," LendingClub Chief Executive Officer Scott Sanborn said in an interview with Reuters when asked about the chance of the U.S. economy entering a recession. "It's not a question of 'if,' it's 'when,' and it's not five years away." The executive and others at online lenders told Reuters that economic indicators and forecasts are worsening, prompting them to be more cautious. Read more at PYMNTS.COM

Compete in the data-driven lending era

Lawmakers embrace significance of financial literacy

Sens. Bill Cassidy (R-LA) and Tim Scott (R-SC) introduced a resolution this week declaring April as Financial Literacy Month, highlighting the importance of learning and maintaining fiscally responsible habits.

The resolution has garnered bipartisan support.

"Learning healthy habits is crucial for long-term financial security," Cassidy said. "Financial Literacy Month is about giving families the tools and knowledge needed to take control of their financial futures."

A Federal Deposit Insurance Corporation (FDIC) report generated in 2017 showed, approximately 25 percent of the nation's households are unbanked or underbanked and have limited or no access to savings, lending, and other basic financial services.

"We live in an America where there is a deep divide between many of our working class who live in distressed communities and the rest of the country," Scott said. "Financial literacy is one of the bridges to closing these gaps and encouraging economic prosperity in our communities. I am excited that I've been able to pass legislation that creates real tangible results for the American people." Read more at Financial Regulation News

Trust Science
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Democratic senators introduce bill to let states impose interest rate caps

U.S. Sens. Sheldon Whitehouse (D-RI), Elizabeth Warren (D-MA), Jeff Merkley (D-OR), and Jack Reed (D-RI) introduced legislation to curb high interest rates for credit cards and loans.

The Empowering States' Rights to Protect Consumers Act would amend the Truth in Lending Act to clarify that consumer lenders - regardless of their location or legal structure-must abide by the interest rate limits of the states in which their customers reside.

"Right now, Wall Street banks and their credit card subsidiaries can saddle consumers with outrageous interest rates, contributing to a cycle of debt that is tough to break out of," Whitehouse said. "This bill will restore the power of individual states to rein in abusive credit card rates."

Previously, each state had the ability to enforce usury laws against any lender doing business with its citizens. That changed in 1978 when the Supreme Court in Marquette National Bank of Minneapolis v. First of Omaha Service Corporation decided that a national bank is bound only by the lending laws of the state in which the bank is based. This rendered states powerless to impose lending restrictions against lenders headquartered in other states.
Read more at Financial Regulation News

CFPB Notice of Proposed Rulemaking (NPRM) on "Payday, Vehicle Title, and Certain High-Cost Installment Loans"

Deadline to submit comments is May 15

In 2017, the CFPB issued a rule on on "Payday, Vehicle Title, and Certain High-Cost Installment Loans" that was needlessly complex and overbroad. It would have caused irreparable harm to industry businesses and eliminated an important form of credit to consumers.

Last month, the CFPB proposed a rule to rescind portions of the 2017 rule, including the Mandatory Underwriting Provisions. The Community Financial Services Association and others support this rule and are pleased the CFPB has taken steps to rescind the mandatory underwriting provisions of its 2017 Final Rule for small-dollar lending. Rescinding these requirements is warranted to avoid unnecessary industry burdens and harm to consumers. If the CFPB's 2017 Final Rule for small-dollar lending were to take effect, it would decimate the entire small-dollar lending industry. It is for these reasons, the CFPB should also delay the payment provisions of the 2017 Rule and begin a new rulemaking for payments.


Comments can be submitted now through May 15, and can be sent electronically, via email or through regular mail.
1) Submit electronically via at

2) Submit via email to
Include Docket No. CFPB-2019-0006 in the subject line of the message.

3) Submit via regular mail or hand deliver to: Comment Intake
Bureau of Consumer Financial Protection, 
1700 G Street, NW, 
Washington, DC 20552 
 Include Docket No. CFPB-2019-0006 in the letter. 
Must be mailed by Friday, May 10, to ensure arrival by deadline.

If you have questions or would like additional information, please email


A Positive Policy Agenda for CFPB Director Kathy Kraninger

The Consumer Financial Protection Bureau has been controversial since its creation. As an executive agency enjoying Federal Reserve funding independent of the Congressional appropriations process-and run by a single director removable only for cause-the Bureau is unusual and possibly unconstitutional. In its first years of existence, the CFPB gained a reputation for its exceptional activism and anti-industry agenda. Curiously, many of its enforcement and rulemaking activities focused on areas that were explicitly outside of its regulatory remit-such as auto lending, federal student loans, and credit providers historically regulated at the state level, such as payday lenders.

When Mick Mulvaney replaced Richard Cordray as CFPB Director, he vowed to stop "pushing the envelope" in its approach to regulation. Progressive fans of the Bureau took this as a sign that Mulvaney would terminate the CFPB's enforcement activities altogether, an expectation that subsequent developments belie. Still, the financial industry, wary of the Bureau's exceptional powers, breathed a sigh of relief that the Cordray-era modus operandi of attempting to change industry practices, even legal ones, through threats of lengthy and expensive enforcement actions might be over.

Now Mulvaney's replacement Kathy Kraninger has the unenviable task of crafting a policy agenda for the CFPB that raises consumer welfare and promotes choice, competition, and innovation in the provision of credit. To assure regulatory certainty, her agenda should fall within the Bureau's regulatory mandate and be compatible with the rule of law. Kraninger will undertake her task in the face of both Democrat Read more at Cato Institute

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Three Tips to Improve Credit Card Processing Costs

As a business, each expense counts, including credit card processing costs. Credit card processing is a necessity to businesses today, but it comes at a price, is very complex, and complicated to understand. Furthermore, for online businesses and companies with recurring customers the threats of fraud and loss are very high. To improve your company's profit margin and reduce risk, we discuss steps you can take to protect your sales and mitigate expenses, potentially saving thousands of dollars each year.

Chargeback Management
Chargebacks can be the death of a business, not only as a loss of revenue, sales and product, but with the potential loss of card processing services. The card brands have specific tolerances based on the ratio of sales to chargebacks and disputed transactions. Anything over a 1% ratio of chargebacks to sales, jeopardizes your ability to accept credit cards as a form of payment.

When shopping for payment processing services, processors look at each of the KPIs of your current processing to establish your risk profile. The more chargebacks that you have increases the processor's risk of loss, as such your processing rates will be adversely affected. Merchant Boost employs a team of Certified Payment Professionals (CPP) with the expertise and experience in helping businesses better manage their payment ecosystem. We can help you to not only win a chargeback dispute, but also identify and reduce chargebacks from occurring in the first place.
Read more at ValidiFi

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Will we survive the next financial crisis?

Three officials who rescued the economy in 2008 warn it might be harder to stop the next panic.

As we pass the 10-year anniversaries of the defining events of the 2008 global financial crisis, it's a good opportunity to reflect on what happened, what we learned and whether it could happen again. Certainly, none of the three of us or our colleagues had ever lived through a crisis like that one, a crisis that was in some ways worse even than the early stages of the Great Depression. The good news is that, this time, concerted government action managed to stop the panic, stabilize the financial system, revive the credit markets and help start a recovery that continues to this day. Indeed, on key dimensions, the U.S. recovery from the Great Recession compares favorably to recoveries from previous severe financial crises, both in the United States and abroad, and the recoveries of other advanced economies from this crisis.

Yet even so, the crisis was extraordinarily damaging, for both the United States and the world. Millions of Americans lost their jobs, their businesses, their savings and their homes. The popular anger generated by the crisis and by longer-term trends of increasing inequality, insecurity, and social immobility has roiled our politics and our society. Read more at POLITICO

Payliance: Powerful Payment Processing Technology

9 Things That Make Good Employees Quit

It's pretty incredible how often you hear managers complaining about their best employees leaving, and they really do have something to complain about-few things are as costly and disruptive as good people walking out the door.

Managers tend to blame their turnover problems on everything under the sun, while ignoring the crux of the matter: people don't leave jobs; they leave managers.

The sad thing is that this can easily be avoided. All that's required is a new perspective and some extra effort on the manager's part.

First, we need to understand the nine worst things that managers do that send good people packing.

1. They Overwork People
Nothing burns good employees out quite like overworking them. It's so tempting to work your best people hard that managers frequently fall into this trap. Overworking good employees is perplexing; it makes them feel as if they're being punished for great performance. Overworking employees is also counterproductive. New research from Stanford shows that productivity per hour declines sharply when the workweek exceeds 50 hours, and productivity drops off so much after 55 hours that you don't get anything out of working more. Read more at FORBES

Merchant Boost Announces Name Change to ValidiFI
Redefining how financial service businesses measure risk and process payments.

Move Payments Faster: Understanding ACH Payment Processing for Businesses

ACH payments are electronic transactions from one bank to another that are processed through the Automated Clearing House network. ACH payments are commonly used for direct deposit of payroll, and online recurring payments of bills, mortgages, and loans.According to the National Automated Clearing House Association (NACHA), 23 billion payments were processed over the ACH network, moving over $51.2 trillion. This represents the sixth consecutive year that ACH payments value has risen by $1 trillion or more, year-over-year. The popularity of ACH transfers has to do with customer comfort level; as electronic payments become more common, more people choose ACH over other payment options. ACH payments also offer several benefits over different types of payment including paper checks, wire transfer, or EFT.

Here are four benefits to ACH payment processing solutions:
1. Lower Processing Costs
ACH transfers usually cost less than alternate forms of payment and are often the cheapest alternative to a cash transaction. Costs may vary depending on the ACH processor; some charge a flat fee per transaction, ranging from $0.25 to $0.; others charge .75 - 5 percent of the transaction value;   Read more at PAYLIANCE 

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.

4 ways a small business can hold on to key employees

Before you make a major effort to keep an employee Opens a New Window. from leaving or lock the person up for the long term to keep him or her from even considering going elsewhere, you have to really consider the value of the person. Is this worker essential to your ongoing success? Is the employee key to your succession plan or valuable in some other way that makes it logical to pull out all the stops to keep him or her on board?

This is not a time to be emotional. You may like the person and enjoy working with him or her. That, however, is not the question being asked when you consider going to extreme lengths to retain a key employee.

Take a deep look and put a value on the person. If that value is high enough that the person may be very hard, if not impossible, to replace, then consider these options.

1. Give the employee a share of the profits
Money Opens a New Window. motivates people, and one of the reasons employees leave is to get more of it. You may not be able to meet the salary levels that larger competitors can, but you can cut key employees in on your profits.   Read more at FOX BUSINESS

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

Creating Value Through the Sale of Accounts Receivable Portfolios

When businesses need to create immediate cash flow, liquidating accounts receivable can meet the urgent requirement of funds. National Debt Holdings helps our creditor clients by offering a quick, compliant, and professional transaction for the sale of your receivables portfolios.

Liquidating your accounts receivable creates an immediate source of funds for your company. Unlike obtaining a line of credit, which can be a lengthy process that involves underwriting and is not flexible should your needs change, selling your receivables portfolios ensures you instant capital to grow your business. Access to cash allows businesses to avoid financing and take advantage of opportunities as they arise, which can provide your business with an advantage over competitors.

National Debt Holdings is a compliant and professional partner for the sale of your performing and non-performing accounts receivable. We are certified by Receivables Management Association International (RMAI) as a Certified Professional Receivables Company (CPRC) and deliver a balance of compliance and performance to turn your accounts receivable portfolios into liquid capital.

We are a revolutionary merchant service and technology firm servicing the debt repayment industry.

INDIANA: Payday loan expansion in Indiana stopped for now

There might have been enough opposition for now to stop legislation aimed at expanding payday and subprime lending in Indiana.

After narrowly passing the Senate earlier this session, the bill died in the House when its sponsor, Rep. Matt Lehman, R-Berne, declined to call it for a vote ahead of a Monday deadline.

Lehman said it was apparent the legislation needed additional work that couldn't be completed by Monday's deadline, according to news reports.

It was supported by lobbyists representing payday and subprime lenders. Lehman has argued individuals have the right to make their own choices and that consumers should have as many options as possible during times of financial emergency.

A bipartisan coalition opposed to the measure, however, argued the new loan products would be considered criminal loansharking under current state law.

We are a revolutionary merchant service and technology firm servicing the debt repayment industry

Amazon Pressured Into Accepting Cash at Cashless Go Stores

The millions of customers who will benefit from the change probably wouldn't shop there anyway.

After both Philadelphia and New Jersey passed laws outlawing most stores that don't accept cash, Amazon (NASDAQ:AMZN) bowed to the assertion that its cashless Amazon Go stores represented "discrimination and elitism" and confirmed they will start accepting cash.

Although the legislative response to Amazon's innovative retail experience was overwrought, and the additional investments will come at a cost, allowing more consumers to shop its stores ultimately makes good business sense, since it opens up the locations to more potential customers.

Leaving money on the table
Amazon has audacious plans to open as many as 3,000 Go stores in the next few years, though currently there are only 10 in operation. The way it works is pretty simple. Customers use their smartphones to download the Amazon app, which is activated upon their entering the store, and with omniscient Skynet-like powers, the store becomes aware of your movements, knowing what you pick up, put down, and leave with. Through an array of cameras, sensors, artificial intelligence, and machine learning, the Amazon Go store knows what you've selected and charges your Amazon account accordingly. Read more at THE MOTLEY FOOL

Alternative Credit Reporting

Alternative Financial Service Providers Association

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