CBA PRESIDENT & CEO RICHARD SEARCH, TESTIMONY ‘DEPOSIT ADVANCE PRODUCTS’

CBA PRESIDENT & CEO RICHARD SEARCH, TESTIMONY ‘DEPOSIT ADVANCE PRODUCTS’

CONSUMER BANKERS ASSOCIATION

PRIOR TO THE UNITED STATES OF AMERICA SENATE SPECIAL COMMITTEE ON AGING

“PAYDAY LOANS: SHORT-TERM SOLUTION OR LONG-TERM PROBLEM?”

Chairman Nelson, Ranking Member Collins and users of the Committee, many thanks when it comes to chance to talk about the short-term liquidity requirements of US customers and bank deposit advance services and products. I am Richard search and I also have always been President and CEO associated with the customer

Bankers Association (“CBA”). 1

Presently, an calculated 76% of all of the Americans live paycheck to paycheck. 2 The economy has remained stagnant leaving customers with less pillow for emergencies, strained credit scores, and less credit choices, making use of fairly priced short-term liquidity items all that more important. Different credit that is entry-level occur to fulfill a number of requirements, including traditional bank cards, signature loans, along with other kinds of credit. Regrettably, numerous customers don’t be eligible for them. In reaction, some banking institutions have actually selected to provide a deposit advance item to satisfy their clients’ need and interest in short-term, small-dollar credit. 3

Deposit advance services and products, offered today by just six banks, provide a critical short-term, smalldollar credit interest in customers that do maybe not be eligible for old-fashioned credit items. The products aren’t loans, they’ve been credit lines (“LOC”) repaid immediately from the recurring direct deposit. (más…)