Frequently Asked Questions
Q: What is FiSCA?
A: Financial Service Centers of America (FiSCA) is the national
trade association representing America’s expanding financial
service centers industry. FiSCA’s membership is nationwide
and provides an extensive array of retail consumer financial
services. FiSCA is comprised of more than 1,300 companies
representing over 7,000 locations, ranging from single store mom &
pop operators to national, multi-state chains. The Association is
headquartered in Washington, D.C., and serves as the financial
service center industry’s leading voice on legislative, regulatory
and business issues that affect its members and the rights of consumers
to access basic financial services.
Q: What types of services
do FiSCA members provide?
A: FiSCA members are continually expanding the
roster of services offered to meet customer needs. Current
financial and other consumer services include:
- Debit cards
- Money orders
- Pre-paid card
based savings accounts
- Money transfers
- Electronic bill payment services
- DMV license
plates and title pick-up
- Small dollar, short-term loans
(e.g., payday advances)
- Electronic tax preparation and
Q: How large is the financial service
A: The Financial Service Center industry is a formidable
national and economically significant force that plays an integral role
in the financial framework of millions of American households.
Through its 13,000 locations nationwide, the industry conducts more than
350 million transactions each year, providing an estimated $106 billion
in various products and services to an estimated 30 million
customers. Those transactions include more than $58.3 billion in
check cashing transactions, $17.6 billion in money orders sold, $8.3
billion in wire remittances, $13.2 billion in payday advances, and $5.4
billon in sales of pre-paid stored-value cards. With over 7,000
member locations, FiSCA represents more than half of the Financial
Service Center Industry.
Q: Are Financial Service Centers
regulated? If so, by whom?
A: Yes. Financial Service Centers that meet
one or more of the definitions of a type of ”Money Services
Business" (MSB) (e.g., check cashing) are designated as MSBs and must
comply with the federal Bank Secrecy Act requirements applicable
to it. MSBs are subject to examination by the Internal Revenue
Service. More information about the federal regulation of
Financial Service Centers can be found at www.msb.gov. At the state level, Financial
Service Centers must also adhere to state laws and regulations in the
majority of jurisdictions, including a requirement that they be licensed
or registered. Financial Service Centers that offer payday loans
must also comply with additional regulations, mainly at the state level,
typically by a state’s department of banking or similar
uses financial service centers?
A: A survey of financial service center
customers conducted in September 2006 revealed the
Females and Males almost equally use
financial service centers (51% Females/49%
Nearly half of customers (47%) are single and
have never been married.
Seventy-one percent (71%) of
customers are between the ages of 26 and
Three-quarters of customers are employed full
Customers are employed in many different ways.
Some customers work in the service industry (25%) or are skilled (12%)
or unskilled (12%) craftspeople. An additional 17 percent hold
management, administrative, sales or clerical positions
Fifty-eight percent of customers have
household incomes between $20K and
Fifty-eight percent of those questioned
in the survey said they use check-cashing locations even though they
have at least one type of account at a bank or credit
Q: Why do people choose to use financial
service centers instead of banks or credit unions?
A: Consumers choose to utilize Financial Service
Centers because the products and services offered by them match their
needs and they are highly satisfied with the way in which their
transactions are conducted. The products and services provided by
FiSCA members fill a niche that financial institutions have chosen not
to fill. The Financial Service Center industry has been successful
because it satisfies the most fundamental needs of its customers.
Many low-and-moderate-income individuals and families live paycheck to
paycheck and do not have the means to leave their hard-earned money in a
bank account. Financial service centers allow customers to access
100% of presented funds instantly, without having to wait for the funds
to clear, thereby bringing them immediate liquidity.
Low-and-moderate-income consumers need access to financial
services in the communities where they live and work. As a result
of demanding lifestyles, consumers need to conduct financial
transactions where and when it is convenient, and in a safe environment
where they feel comfortable and respected. Financial service
centers maintain stores in the communities where these consumers live
and work, offering flexible hours (many 24/7), cashiers who speak the
languages of the community, and who understand customers’ needs
Financial service center representatives deliver quick, courteous
and personalized service to customers with each financial
transaction. In addition to the financial services listed above,
Financial Service Centers also offer helpful products like transit
system access cards, stamps and more.
moderate-income consumers need to manage tight budgets and cannot be
subject to surprise fees and incomprehensible charges. When money is
tight, an unexpected charge can be catastrophic. Unlike banks and
credit unions, all fees charged by financial service are posted and
known up front – there are no surprises. All fees are paid
at the time of the transaction, at the point of
Financial Service Centers provide access to financial services to the
unbanked and underbanked segments of the population?
A: Yes. Financial Service Centers provide financial
services to many consumers who are either unbanked (people with no
checking or savings accounts) or underbanked (individuals who have an
account but do most of their “banking” through Financial
Service Centers). There are as many as 56 million Americans who do
not use traditional financial institutions, such as banks and credit
unions, when conducting their routine financial business.
Q: Why do people choose to cash
checks with FiSCA member locations when they have a bank account?
A: Although 58% of FiSCA members’ customers maintain
at least one bank or credit union account, the increasing cost of fees
and minimum balance requirements in checking and savings accounts makes
the use of banks, credit unions and other financial institutions
expensive and difficult to manage for consumers. Thus, these consumers
turn to Financial Service Centers as an alternative which provides
convenient and affordable ways to manage their finances.
Q: Is FiSCA doing anything to
help low-and-moderate-income consumers build savings or earn credit?
A: Yes. FiSCA members have proactively pioneered and
implemented a Consumer Empowerment Program which is designed to advance
the overall financial well being of low- and moderate-income
consumers. The FiSCA Consumer Empowerment Program
FiSCA spearheaded and initiated a National Savings Program. It
negotiated a revolutionary mechanism with NetSpend Corporation, through
which consumers can establish a no fee, FDIC-insured, interest bearing
savings account, through their NetSpend Card. Then, they can
transfer money back and forth between the card and their savings account
at no cost. The accounts require no minimum monthly balance to
maintain and are currently earning 5% interest. No other card
product offered on the market incorporates a savings element of this
need for a credit rating that is recognized by home and auto lenders,
insurance companies, employers and others is fundamental. Through
the FiSCA/PRBC? (Payment Reporting Builds Credit) partnership, FiSCA
members offer their customers the ability for their history of making
timely rent and other recurring payments to bolster their
creditworthiness. Through the credit scores provided by the
FiSCA/PRBC Credit Building Program, it is anticipated that customers
will get needed access to credit at prevailing rates, and enjoy other
benefits not previously available to them.
financial education programs do not adequately target the needs of many
low- and moderate-income consumers because they teach about products and
services these consumers do not use, or which are not accessible to
them. In recognizing this fact, FiSCA recently commissioned the
development of the first of its kind “audience appropriate”
financial education program which better reflects the demonstrated
needs, preferences and behaviors of low-and-moderate-income consumers
who choose to use financial service centers.
For more information visit the FiSCA Consumer Empowerment Program
Q: How does the National
Savings Program work?
A: Access to virtual savings accounts through financial
service centers is simple:
- An individual purchases a
NetSpend debit card at a participating financial service center that is
a member of FiSCA. There are thousands of stores in neighborhoods across
- NetSpend debit card holders can enroll in the
savings program online or over the telephone.
- Once enrolled, a
free FDIC-insured bank account is established for the cardholder.
National Savings Program accounts are established at either MetaBank
(headquartered in Iowa) or Inter National Bank N.A. (located in
- Funds can be conveniently transferred at no cost between
the debit card and the savings account via the Web, automated phone
system, or via a live NetSpend customer service
- Cardholders can set up automatic, recurring transfers
from their debit card to their savings account to encourage and
facilitate easy savings.
|Q: What are payday advances or
A: Payday advances are small, short-term cash advances,
typically of $500 or less. In recent years, payday advances have become
an increasingly popular choice for American consumers in need of small
dollar, short-term credit. Currently, 35 states have laws
permitting these loans. Industry analysts estimate that there are more
than 22,000 locations that offer payday advances nationwide extending at
nearly $50 billion annually in short-term credit. Transparency is a key
element to the payday advance product. All terms and fees are clearly
posted in every store and included in every contract. Members offering
short term loans also adhere to a rigorous code of
conduct. View FiSCA’s Code of Conduct “Offering Access
|Q: Who uses payday advances?|
A: The typical payday advance borrower is representative
of the America’s working middle class. Customers are
typically between the ages of 25-44 years old, with an average household
income of more than $40,000 a year. The majority of customers are
high school graduates with a college some education or a degree.
All payday advance customers have a steady source of income
and maintain active checking accounts. View additional information about payday
|Q: Why do people choose a
payday advance to borrow money for a short period of
A: Surveys show that
while most people typically do a good job of managing their household
budgets, many of us need occasional help. An increasing number of
consumers choose a payday advance to cover unexpected expenses or bridge
a short-term cash shortage between paydays. A payday advance is a
short-term loan that provides a sensible alternative to overdraft
protection, bounced checks, late payment charges on routine bills and
credit card balances, some of which can tarnish a consumer’s
Q: Are financial services
offered at Financial Service Centers more expensive than those offered
A: The rates at Financial Service Centers are competitive
and very often less expensive than those of banks for the same or
similar services. Financial Service Centers clearly post all fees
in an easy-to-understand form, which enables consumers to know up-front
what the exact cost of each transaction will be before the transaction
ever begins. This also enables them to compare the costs of these
services to what banks or others are charging for them. Get information on cost comparisons
Consumers make this purchasing decision based on a
number of factors, including: cost, accessibility, and service.
Whether it’s to cash a check, obtain a small dollar loan, wire
funds to a relative or any of the many other financial services offered,
our customers choose us because we offer the best alternative to meet
their current needs.
|Q: What is the FiSCA
National Scholarship Program?|
A: In 1999, FiSCA established its National Scholarship
Program. Every year, more than 1,000 students from across the country
compete for these scholarships. To date, FiSCA has awarded nearly
$400,000 in college grants to 164 deserving college-bound students.
Scholarship winners receive a minimum $2,000 cash grant to be applied
towards their freshman year of studies at a college of their
choice. View more information about the FiSCA Scholarship
|Q: Where can I get more
information on FiSCA and financial service centers?|
A: For more information about FiSCA and its
members, please visit other pages on this website or call our
national headquarters at (201) 487-0412, or contact FiSCA by email.