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Treasury’s Bessent: Private credit surge underscores need for bank deregulation

“The growth of private credit tells me that the regulated banking system has been too tightly constrained,” Scott Bessent said Monday.

Dive Brief:

• Treasury Secretary Scott Bessent on Monday emphasized the Trump administration’s aim to pursue deregulation for financial institutions, pointing to private credit’s rise as a sign banks have been overly burdened in recent years.
• Bessent referred to private credit as an “incredible” element of the capital markets, but said “the growth of private credit tells me that the regulated banking system has been too tightly constrained,” Bessent said Monday at the Milken Institute Global Conference in Los Angeles.
• “The regulators are aligned,” and will be “safe, sound and smart and redoing regulated financial entities,” Bessent said.

Read more at BANKING DIVE

Top Open Banking Trends 2025: Transforming Financial Services

Key Takeaways

• The accelerated adoption of open banking is driven by regulatory harmonization, increasing consumer demands for transparency, and enhanced user experiences through personalized financial tools.
• Real-time payments are transforming the landscape of financial services, facilitating instant transactions and improving operational efficiency while necessitating robust data security measures to counter emerging fraud threats.
• Collaboration between traditional banks and fintech companies is essential for innovation in open finance, enabling personalized services and compliance with evolving regulations to enhance consumer financial management and inclusion.

Accelerated Open Banking Adoption

Open banking is reshaping the financial services landscape, making it imperative for institutions to embrace this change to remain competitive. The widespread adoption of open banking is being spurred by increased business offerings, growing consumer usage, and regulatory harmonization, which collectively cater to a market craving for transparency and control. This shift is not only about meeting regulatory requirements but also about enhancing the consumer experience by offering more choices and personalized financial tools

Read more at NETGURU

2025 tax season: What do returns look like so far this year?

Average tax refund is larger than last year's so far, though IRS reports issuing fewer refunds

New data from the Internal Revenue Service (IRS) shows the size of the average tax refund received by taxpayers is up from a year ago.

IRS data for the 2024 tax filing season through the week that ended on April 25 showed the average tax refund amount is up 3.3% from last year's filing season, rising from $2,852 to $2,945.

The total amount refunded grew at a slower 2% pace, rising from $260 billion to $265 billion over last year.

The total number of tax refunds issued by the IRS is down 1.3% in the current filing season when compared with a year ago, having fallen from 91.3 million to 90.2 million in that period.

Read more at FOX BUSINESS

Cashless Wave Sweeps Latin America Amid Mobile, FinTech Boom

Latin America is undergoing a dramatic shift in how money moves. But it isn’t traditional financial institutions that are leading the charge. Instead, mobile wallets and real-time payment systems are rapidly gaining ground across the region, and these 21st century solutions to the age-old problem of money movement are even overtaking banks in the race to digitize transactions.

Data from the PYMNTS Intelligence April 2025 “Embedded Finance Tracker® Series” points to a region not only embracing cashless technology but leading in it.

The report shows that, across Latin America, cash is rapidly losing ground as consumers pivot to digital payments. In 2014, cash made up 67% of in-store transaction value. A decade later, that figure has dropped to 25%. eCommerce transactions have followed a similar trajectory. Digital payments accounted for 48% of online purchase value in 2024, up from just 14% a decade earlier. Their share is expected to climb to 66% by 2030 for eCommerce, and 49% of in-store transaction value.

Read more at PYMNTS.COM

Have a tax law question?

Our #IRS Interactive Tax Assistant has answers.

Watch this short video to learn more:

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Jose L. Santiago

Public Affairs Specialist

Tax Outreach, Partnership and Education

Email: jose.l.santiago@irs.gov

Student Loan Questions and Answers amid Uncertainty

Defaulted student loans went into repayment May 5. With more legislation pending and questions mounting, here’s some important information current and soon-to-be payers need to know

The collection on defaulted federal student loans has officially resumed. 

While repayment on federal loans resumed in October 2023, at the time the Biden administration provided some protections for borrowers who were behind on their payments. That grace period ended on May 5, marking the conclusion of student loan relief efforts that President Trump and then President Biden enacted in response to the COVID-19 pandemic. 

Meanwhile, executive orders and proposed legislation regarding student loans have caused major confusion for borrowers in recent months about what options remain for repaying their loans.

Read more at BOSTON UNIVERSITY

More people are buying now, paying later — even for groceries

We're still taking out microloans for everything from Coachella to basic necessities

Between an upfront payment of $120 or four separate smaller payments of $30, which one would you prefer? For almost half of all Americans, it’s easily the latter.

Buy now, pay later services like Klarna and Afterpay have become increasingly popular in recent years, acting as microloans for many online purchases. The reasons for their popularity are apparent: You get the instant gratification of buying and receiving a product at a slashed upfront cost, without having to pay interest fees upon repayment. And unlike traditional loans, you generally don’t need to pass a hard credit check to qualify for BNPL, per the Consumer Financial Protection Bureau. 

With prices rising across the board, the option of smaller delayed payments are attractive for many consumers, whether they’re college students or adults working a 9-to-5. The majority of BNPL users take out loans to buy wants — not needs — like electronics and accessories. And that’s part of why the microloans are so appealing.

Read more at SALON

Whether as a standalone store or a kiosk inside your current location/s,

El Vecino provides a turnkey solution with a strong brand, built-in provider network, and all the support you need.

How Payments Companies Are Making the Personal Touch Pay Off

Throughout my nearly decade-long career with Maverick Payments, I have found that a personal touch goes a long way. No matter the customer’s size, they will always remember how they were treated during their first interaction with you. For instance, I recently assisted a customer I’ve maintained contact with over the years. Their newest inquiry was over a simple billing preference matter. While my title has evolved since our initial interaction, and I now oversee a team capable of handling such requests, the customer chose to reach out to me directly, confident I would resolve their issue. I assured them it would be taken care of promptly by my team, and they expressed their gratitude, ultimately resulting in a positive testimonial from the client. This relationship has fostered loyalty; the customer has since referred additional business to us, demonstrating their trust in being well-supported.

Nowadays, our customer service team has grown into a comprehensive call center and customer support system. Our team members undergo rigorous training to ensure they consistently deliver exceptional service in every interaction. We measure response times daily and focus on areas for improvement based on key metrics. Our management team reviews call recordings to ensure our policies are being adhered to while ensuring our representatives are delivering friendly service and top-notch support.

Read more at PYMNTS.COM

US digital payments: How are new and traditional payments rails merging?

It’s been an exciting few years watching the launch and take off of instant payments in the US after many years of discussions about the US being ‘behind’. With the start of RTP in 2016 and the introduction of FedNow in 2023, the infrastructure is now in place to truly get us off and running. However, growth has been slow in terms of adoption by banks and transaction volume. After all the discussions and industry push for the US to have this infrastructure and how the US has lagged behind others, why is adoption taking so long? Is it the established usage of current rails - Wire and ACH specifically - that are impacting this growth, or is it something else?”

Background

ACH and Wire have both been in operation in the US for many decades and as is the case with instant payments, the US has two key providers: The Clearing House and the Federal Reserve. Domestically, wires are traditionally used as a wholesale product—primarily for high-value payments between banks. They’re also used for other significant transactions, such as home purchases or funding large deals.

Read more at FINEXTRA.COM

The IRS has lost almost one-third of its tax auditors after 2 months of DOGE cuts

The Trump administration's plan to trim the IRS workforce has resulted in almost one-third of its tax auditors leaving the agency through March, according to a report from the U.S. Treasury Department's watchdog.

Elon Musk's Department of Government Efficiency, or DOGE, has sought to trim the federal workforce through a combination of layoffs and so-called deferred resignation. Musk, the billionaire CEO of Tesla, said on the electric vehicle maker's April 22 earnings call that DOGE's efforts "in addressing waste and fraud" will "get the country back on track."

Read more at CBS NEWS

What are bank statement loans?

When people apply for a traditional mortgage, they typically must provide W-2 forms and tax returns as proof of income, along with numerous other documents.

If you’re buying a house as a self-employed borrower, independent contractor, or gig worker, you may not have a W-2 to show a mortgage lender. Business owners often have complex tax returns that don’t accurately reflect their income since they may deduct extensive business expenses.

A solution that some mortgage lenders offer is a bank statement loan — one that relies on your business bank statements to prove your income and expenditures and help determine how much you can borrow. It can be a great fit for home buyers without “traditional” sources of income.

Read more at YAHOO FINANCE

U.S. Private Credit Defaults Remain Elevated

Fitch Ratings-New York/Toronto/Austin-06 May 2025: According to a new report from Fitch Ratings, the trailing 12 months (TTM) issuer-weighted default rate in Fitch’s privately monitored ratings (PMR) portfolio remained elevated, dipping slightly to 7.8% in 1Q25 from 8.1% in 4Q24. Fitch recorded four new unique defaulters in 1Q25 while four rolled off, keeping the total at 23 unique defaulters for TMM 1Q25, unchanged from YE 2024. TTM defaults in 1Q25 totalled 31, with three involving Chapter 11 cases or liquidations. The downgrade-to-upgrade ratio in the PMR portfolio ticked slightly higher to 3.0x in 1Q25 from 2.8x the previous quarter.

Fitch’s private credit default rate (PCDR) for the TTM period ending 1Q25 dipped slightly to 4.5% from 4.6% at YE 2024. The rate covers PMR issuers as well as about 900 additional issuers that Fitch assesses for middle market (MM) collateralized loan obligation (CLO) ratings. Fitch recorded 17 new unique defaults in 1Q25, bringing the total to 56 unique defaults for the TTM period ending 1Q25.

Read more at FITCHRATINGS

Trump’s CFPB drops enforcement of buy now, pay later rule in latest rollback of consumer protections

Key Points

• The Consumer Financial Protection Bureau said Tuesday it will stop enforcing a Biden-era rule treating buy now, pay later firms like credit card lenders.
• The agency cited a need to focus resources on “pressing threats to consumers,” especially service members, veterans, and small businesses.
• The fintech industry had sued to block the rule last year, arguing the agency bypassed proper rulemaking.

For the third time under President Donald Trump, the Consumer Financial Protection Bureau has pulled back from enforcing a key rule, this time targeting buy now, pay later services.

Read more at CNBC

Private student loans could make a comeback under the GOP's new bill

The Republican proposal could push more students to consider private loans or find ways to borrow significantly less for their degrees.

More Americans will likely need to borrow private student loans to pay for college and graduate school under reforms Republicans are moving forward on Capitol Hill — especially if they want to become doctors or lawyers.

GOP lawmakers are aiming to include a major shake-up of the federal student lending program in their party’s marquee tax and budget bill, which they are piecing together in the House. Those changes include new lifetime loan limits that would have their biggest impact on students seeking professional degrees, according to an analysis by the Urban Institute, a Washington-based think tank.

Read more at YAHOO FINANCE

Investors fled to Europe and Japan after Trump’s tariffs jolted U.S. markets, Bank of America says

Key Points

• Investors pulled $8.9 billion out of U.S. equities while sending $7.8 billion to foreign stocks in the week ending April 30, according to Bank of America.
• Gold and U.S. Treasury bonds also saw outflows while cryptocurrencies, high yield bonds and technology shows had inflows.
• BofA’s private clients held 62% of their portfolio in stocks, 20% in bonds and 12% in cash.

Stocks on Wall Street and beyond have been rocked by volatility in recent weeks, as U.S. President Donald Trump rolled out some tariffs, paused others, and ramped up duties on Chinese goods to unprecedented levels.

Read more at CNBC

We advise financial technology companies at the

start-up, product development, and product evolution stages.

Financial literacy behind bars: A key to breaking the cycle of recidivism

By making financial education a core part of reentry planning, corrections agencies can equip individuals with the tools they need for long-term stability and safer communities

Many incarcerated individuals lack basic financial education, increasing their risk of reoffending. According to the Bureau of Justice Statistics (2024), more than 60% of incarcerated individuals have little to no formal financial education, leaving them unprepared for stable employment, housing, and legal obligations upon release. Teaching financial literacy in prisons can disrupt this cycle by equipping them with the tools they need for long-term stability.

Financial struggles are a key factor behind crimes such as theft, drug dealing, and fraud. Many incarcerated individuals lack basic budgeting and debt management skills, making it difficult to achieve financial stability after release. Without these skills, they may turn to illegal activity to survive. Beyond personal financial management, they face court costs, job shortages, and housing challenges, all of which increase the likelihood of reoffending. This often recreates the same economic conditions that led to incarceration in the first place. [1]

Read more at CORRECTIONS1.com

How Pay-Over-Time Can Help Banks Fight the BNPL Surge

As BNPL providers gain market share, banks aim to strengthen their pay-over-time options. Embedding installment plans at checkout, leveraging customer data for personalization, and forming merchant partnerships can help banks optimize adoption and compete on cost.

Buy Now, Pay Later (BNPL) has gone mainstream — particularly among younger consumers. According to Billtrust’s 2025 Gen Z & Digital Payments Report, BNPL usage among Gen Z jumped from 26% in 2023 to 46% in 2025, a 77% increase in just two years, primarily using it for spending on everyday purchases.

For banks, this shift highlights a challenge. While credit cards still dominate overall spending, BNPL’s influence grows as Affirm and Klarna integrate directly into checkout experiences. Now, banks are ramping up their pay-over-time offerings, with some embedding installment options into credit cards and mobile banking apps.

Read more at The Financial Brand

This bank pays $10K for opening an account — plus 9 more of the biggest sign-up bonuses of May 2025

If you don’t qualify for the best cash offers this month — and most will not — we’ve included the 5 most accessible sign-up bonuses, as well

Yields for savings accounts and CDs are largely down this month, but that hasn’t stopped dozens of banks and credit unions from dishing out some sizable cash bonuses — with at least one brokerage account still offering $10,000 to those who qualify. But with the biggest sign-up offers of May 2025 also including some big hurdles, NerdWallet lead investing writer Sam Taube stresses that these offers are often made to ensure the institution earns its own bonus: you.

“Banks offer sign-up bonuses to attract new customers,” says Taube. “Many offer sign-up bonuses on checking accounts, which don’t typically pay significant interest, but they can also make savings accounts more alluring. Psychologically, promising new customers a concrete amount of money — say, $200 — may have more of a draw than an extra 1% of yield.” That said, it’s often the savings account — some of which pay 4% or more — that will earn you far more. (You can see some of the highest paying savings accounts from our partner Bankrate here.)

Read more at MARKETWATCH

Alaska lawmakers push to make financial literacy a graduation requirement

When you graduated from high school, did you know how to create a budget? File taxes? Or understand what a 401(k) is? Many Alaskans didn’t — and now, lawmakers in Juneau are working to change that for the next generation.

Alaska ranks dead last in the nation when it comes to financial literacy, according to multiple national organizations.

That’s why Senator Bill Wielechowski of Anchorage is introducing Senate Bill 22, a plan that would require all Alaska high school students to earn financial literacy credit.

Read more at YOURALASKALINK.COM

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Swiss National Bank ready to take rates below zero to tackle low inflation

ZURICH, May 6 (Reuters) - The Swiss National Bank is ready to intervene in the foreign currency markets and cut interest rates even below zero to prevent inflation falling below its price stability target, Chairman Martin Schlegel said on Tuesday.

Swiss inflation fell to 0% in April, its lowest level in four years, government data showed on Monday, at the bottom end of the SNB's 0-2% target range.

The reading fueled expectations the SNB will cut rates from the current 0.25% at its next policy meeting on June 19, while markets expect rates could go below zero later in the year.

Read more at REUTERS

Samsung Wallet just made it easier to send money in the US

Send money to friends and family by just tapping your phones together.

It's been known for some time now that a Tap to Transfer feature will soon be available on Samsung Wallet in the United States. This feature will make it possible to send money to friends and family just by tapping your phones together, simplifying tasks such as splitting a dinner bill.

The company has announced today that Samsung Wallet's new Tap to Transfer feature for person-to-person payments will be live in the US “later this month”. In addition to tapping phones together for transfers, it's also possible to send money to someone's Samsung Wallet even if they're not nearby.

Funds can also be transferred by tapping on their debit card

Read more at SAMMOBILE.COM

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