PRESIDENT & CEO,
CONSUMER BANKERS ASSOCIATION
PRIOR TO THE UNITED STATES OF AMERICA SENATE SPECIAL COMMITTEE ON AGING
PAYDAY ADVANCES: SHORT-TERM SOLUTION OR LONG-TERM PROBLEM?
Chairman Nelson, Ranking Member Collins and people in the Committee, many thanks when it comes to chance to talk about the liquidity that is short-term of US customers and bank deposit advance items. I am Richard search and I also have always been President and CEO regarding the customer
Bankers Association (вЂњCBAвЂќ). 1
Presently, a projected 76% of all of the Americans reside paycheck to paycheck. 2 The economy has remained stagnant making consumers with less pillow for emergencies, strained credit scores, and less credit choices, making usage of fairly priced short-term liquidity products all of that more important. Different entry-level credit services and products occur to satisfy an array of requirements, including old-fashioned bank cards, signature loans, as well as other kinds of credit. Regrettably, numerous customers try not to be eligible for them. As a result, some banks have actually selected to provide a deposit advance product to satisfy their clientsвЂ™ need and interest in short-term, small-dollar credit. 3
Deposit advance items, offered today by just six banks, provide a critical short-term, smalldollar credit interest in customers that do perhaps maybe not be eligible for old-fashioned credit items. The products aren’t loans, they’ve been personal lines of credit (вЂњLOCвЂќ) paid back automatically from the recurring deposit that is direct.Continue reading