What’s Being Said about the Financial Service Center Industry (see note)

“These businesses [financial service centers] are key components of a healthy financial sector, and it is very important that they have access to banking services.”

U.S. Treasury Secretary John Snow, February 10, 2005, issue of American Banker

“Money services businesses are critical to the world’s economy. They enable people to send remittances to poor countries with the transparency of depository institutions. The Treasury Department, of which FinCEN is a part, considers that transparency far preferable to driving the businesses underground.”

William J. Fox, Director, Financial Crimes Enforcement Network (FinCEN)

“We are aware of this problem [bank discontinuance] and agree with you that it threatens to undermine the accomplishments we have made over the past several years in enhancing the security and transparency of the Money Services Business industry. We take very seriously the important role that check cashers and other Money Services Businesses play in providing financial services to segments of our society that may not have access to the more traditional banking system. To that end, we remain committed to working with organizations such as the Financial Service Centers of America and your members to ensure continued access to bank accounts.”

 William Langford Jr., FinCEN Associate Director for Regulatory Policy and Programs, in a letter to FiSCA dated January 4, 2005

"This [bank discontinuance] is a serious issue, because money service businesses form a critical part of the financial sector."

Juan Zarate, U.S. Treasury assistant secretary for terrorist financing

“It is absolutely not the OCC’s intent that national banks should be forced to sever their relationships with money-services businesses. MSBs play a vital role in the national economy, providing financial services to individuals who are not otherwise part of the mainstream financial system.”

Julie L. Williams, acting U.S. Comptroller of the Currency

“My department licenses and regulates all of the check cashers in this state. We know better than most how valuable they are to our economy and how essential the services they provide are to hundreds of thousands of New Yorkers. In fact, I would paraphrase what Mr. [Gerald] Goldman, counsel to the check cashers trade group, had to say in the article: Not everybody can have a bank account. We know there are many reasons that people choose not to use banks. People who want and need to use check cashers should use check cashers. What I did say is that you can't open a savings account at a check casher, and that I hope some of those who are unbanked will consider opening a bank account, especially as a safe, secure means to saving money. Doing this and using a check casher for everyday transactions are not mutually exclusive endeavors.”

Diana L. Taylor, Superintendent of Banks, State of New York Banking Department, In a Letter to the American Banker,
January 21, 2005

 “NetSpend’s platform is an idea whose time has come.  It allows underserved Americans to participate in the mainstream economy.” 

Former U.S. Senator Bill Bradley (D-New Jersey), regarding the FiSCA/NetSpend National Savings Program

“You provide such an important service to such a large, and often unbanked, segment of our society. And the check cashing industry is an important part of our economy in New York City, employing more than 4,000 people. The Banking Department shares a common goal with the Check Cashing industry to protect the interest of consumers and ensure confidence in using its services which meet a huge and important need throughout New York State.  I am committed to ensuring that your industry is as well served by us as any of the other businesses we supervise or license.”

NYS Banking Superintendent Diana Taylor, May 11, 2004, at the 12^th Annual FSCNY Conference and Vendor Show

“The PayNet Deposit program is a partnership among check cashers and credit unions in the New York City metropolitan area that provides credit union members with access to their accounts through check cashing locations. The program is a prime example of the type of innovative partnership that has the potential to work to the benefit of both company and consumer to increase access to financial services among underbanked populations.”

The Center for Financial Services Innovation (CFSI) study, October, 2004

“There is an ongoing need for what you do. If there wasn’t a need for your services, you could not go on doing what you do….It is important what you say to the people who criticize the products you offer, like payday loans. They say ‘no, no, that’s wrong’ but they never offer an alternative. People in the communities you serve need the leverage and opportunity for access to credit that you provide. Since we know that banks are not going to do it and these are services Americans are crying out for, what you do is important.”

Kweisi Mfume, president and chief executive officer, National Association for the Advancement of Colored People (NAACP), during keynote address to FiSCA at 2001 National Conference & Exposition

“Check cashing outlets offer their customers, who are largely unbanked, a one-stop shop for all of their financial services needs. These businesses have created a niche market by offering underserved customers more convenient hours, locations and services than those of banks. The added convenience, however, does come at a cost.”

Sam M. Ditzion, analyst for Dove Consulting and co-author of the study prepared for the Treasury Department in 2000, from the Boston Globe, June 2000.

“Surveys also suggest that customers are satisfied with the services they receive from check cashers, which include convenient locations, flexible hours, short lines, ancillary services such as bus passes and lottery tickets, and, perhaps most important, immediate cash without waiting for a check to clear.  Market research by mainstream banks such as Chase Manhattan confirm check cashers competitive advantages.  Chase’s Kenneth Rosenblum points out, ‘Check cashers are far more superior to banks in terms of the days and hours they are open for business and their ease of access.’ ”

Kenan Institute for Private Enterprise, University of North Carolina

“You have an industry people choose to use. They choose it over banks and they are satisfied with the service they receive. That is our free enterprise system.”

U.S. Rep. Spencer Bachus (R-Alabama)

“Payday loans can provide a valuable service in emergencies—helping people meet day-to-day credit needs.”
 

Donna Tanoue, chairwoman, Federal Deposit Insurance Corp.
 

“Instead of running with the tide we decided we would go out and talk with check cashers. We found a very interesting thing: check cashers make very good bank customers. What I admire most about you is your entrepreneurial spirit. You do so much better of a job adapting to the changes in the financial services industry than banks do.”

John A. Kanas, chairman, president and chief executive office North Fork BanK 

“Your industry was among the first to feel the accelerated pace of the PATRIOT Act and you have set a remarkable example for others to follow. Your industry’s response to the new requirements was prompt and positive. Thank you for the standard you have set for the financial services industry in the fight against money laundering, financial crimes and terrorism.”

James Sloan, Director, Financial Crimes Enforcement Network

“The reason we see so many of these businesses (financial service centers) is because there’s a societal need for them.”

Rep. Frank Rasche, Kentucky Legislature
 

“I love the work you do and I love how you do it. In the rush to create huge national and international conglomerates, the needs of the smaller, hard working, not yet rich, struggling American, often an immigrant like my mother and father, are either ignored or met indifferently by both private industry and government. You serve those communities well and I congratulate you.”

Mario M. Cuomo, former governor, New York State

“They are the financial equivalent of convenience stores. You can be in and out of one of those places in 10 minutes.  It’s the same principal as a gallon of milk: some people are willing to pay more for a gallon of milk [at a convenience store] because the store has made it so easy for you to go get it.”

Richard Keck, Ohio’s Chief Examiner for Consumer Finance, Cincinnati Post, June 19, 1999

“Payday loans are a legitimate service that many honest consumers use.”

U.S. Senator Orrin Hatch (R-Utah)

“FiSCA members are at the forefront of what I believe are valuable services. You guys and gals fill a gap for many people.”

U.S. Rep. Bob Ney (R-Ohio)

“There are about 100 companies that we license, with about 469 payday lending locations, from mom and pop companies to larger, national players. They all appear to be sound. Very few go out of business, although some may close if there’s not enough volume. Our experience is that this is a product that consumers seem to want. If they wish to engage in that product, that’s their choice.”

David Coyle, director of the Kentucky Division of Financial Institutions
 

“Growth of these businesses (financial service centers) also amounts to more economic opportunity for those in need of their services. It provides the freedom to manage personal finances as they see fit.”

Wade Hudson, policy analyst with Reason Public Policy Institute (Santa Ana, Calif.)

“It is a good thing for an organization like yours to have a code of conduct for members of the industry to follow. The industry has matured. It has achieved greater legitimacy. Some of my fellow state regulators may not love the payday loan product; the majority of my peers dislike the fees. But, this is a matter for consumers to decide. It is a product a lot of consumers utilize and need.”

Laura Udis, administrator, Colorado Uniform Consumer
Credit Code

“What is payday loan or advance? It’s important financial service used by thousands of consumers every week. It allows a person to get a small amount of cash for a short period, with the loan made against his or her next paycheck.  There is overwhelming evidence that payday advance loans provide a valuable service, filling a critical financial need for millions of Americans in states across the country.  In one of those states, North Carolina, a recent report by the State Commissioner of Banks revealed just how well consumers like the payday loan option.  The report cited 2.9 million North Carolina transactions in 1999 with the Commissioner of Banks receiving only 12 complaints.”

Al Cors, Jr. Vice President of Taxpayers Union

“The purpose of payday loan centers is to get you to payday. It’s for a very short-term nature. So if you roll over and incur additional charges, it’s a very, very expensive way to borrow long-term…I think even those adamantly opposed to the classic payday loans would admit there’s a need out there.

Gavin Gee, director of the Idaho Department of Finance,
from The Idaho Statesman, August 2000

“I don’t understand why you think consumers are so dumb that they can’t take on responsibility of their own.”

Rep. Steve May, Arizona State Legislature, in The Arizona Republic. Written in response to the position on deferred deposit by the Consumer Federation of America.

“There is little debate that fringe lenders provide critical services to customers whose extremely low or unreliable incomes, limited tangible assets, or inability to manage credit make them unlikely candidates for mainstream financial services.”

Fannie Mae Foundation

“Consumers choose payday advances usually to avoid other circumstances that may create more of a financial hardship than the fee. They want to avoid late fees on rent, their utilities being disconnected, or the embarrassment of being denied by a bank or other sources, or the humiliation of asking relatives or friends for help…Millions of consumers in states across the country use the payday advance product responsibly. The payday advance industry is not the cause of financial problems, but a symptom of deeper problems inherent in how people manage their daily finances.”

Patrick Vandenberg and Catherine Williams,
Wisconsin Consumer Credit Counselors