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

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

CUSTOMER 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 people in the Committee, many thanks for the chance to talk about the liquidity that is short-term of US customers and bank deposit advance items. I’m Richard search and I also have always been President and CEO associated with the customer

Bankers Association (“CBA”). 1

Presently, an approximated 76% of all of the Americans reside paycheck to paycheck. 2 The economy has remained stagnant making customers with less pillow for emergencies, strained credit scores, and less credit choices, making use of fairly priced short-term liquidity items all of that more important. Different credit that is entry-level occur to fulfill an array of requirements, including old-fashioned bank cards, unsecured loans, as well as other kinds of credit. Unfortuitously, numerous customers usually do not qualify for them. As a result, some banking institutions have actually plumped for to provide a deposit advance item to meet up with their clients’ need and interest in short-term, small-dollar credit. 3

Deposit advance services and products, offered today by just six banks check city loans hours, provide a critical short-term, smalldollar credit need for customers that do perhaps not be eligible for conventional credit items. These items aren’t loans, they have been credit lines (“LOC”) paid back immediately from the recurring direct deposit.