PROVIDING ESSENTIAL FINANCIAL SERVICES DURING THE COVID-19 PANDEMIC
Amid the uncertainties and anxieties resulting from the COVID-19 pandemic, as many families confront magnified challenges, financial liquidity is especially critical. Members of CFSP, representing the diverse and innovative consumer financial services industry, have been designated "essential" throughout the pandemic. We have continued to operate locations throughout California, and on-line, offering critical financial services to millions of Californians, particularly middle-income, working families, who value and choose our simple, reliable, convenient services. We are proud to be there for our customers and communities during this unprecedented time, committed to providing consumers with regulated financial inclusion, and stability.
Consumers' Financial Needs
The Covid-19 pandemic and related economic crisis are the latest tests to our country's ability to provide financial inclusion and stability to all American consumers. Before this crisis, the Federal Reserve reported that nearly 40 percent of American adults needed to borrow or sell something to cover a $400 expense, or were unable to cover it at all. Today, those challenges no doubt remain very real for many. In fact, a Bank rate survey from January 2021 found that fewer than four in 10 Americans could absorb the cost of an unexpected expense of $1,000, such as a care repair or emergency room visit.
Regulated consumer financial services providers have long played a vital role in California, and the nation's, financial services landscape, equipping consumers with access to a variety of solutions to help manage their personal finances. This necessary function has been recognized prominently and consistently throughout the pandemic, with the Department of Treasury, the Department of Homeland Security, and California designating our industry as critical financial infrastructure. Embracing this responsibility, CFSP members, which span large companies with national reach to small "mom and pops" - have stayed open and operating throughout the pandemic, even when many other, more traditional financial institutions were closed.
Essential Financial Services
As millions of Californians struggle with financial hardship, our sustained operations have helped them to access wages and benefits, including stimulus payments; pay bills; aid family members and friends; and conduct other financial transactions in a regulated, licensed setting. CFSP members provide an array of basic financial products and services in storefronts across innovative, integrated platforms and channels, including:
• Check Cashing,
• Pre-paid cards (including offloading of funds),
• Domestic and international money transfers,
• Electronic bill payments, and
• Small dollar consumer loans.1
How We're Helping
For those customers CFSP members continue to serve, regulated consumer financial services provide an important lifeline for them and their families. As always, our customers carefully consider consumer financial services, weighing the costs and consequences of all of their options. Many find our products and services to be the most cost-effective, transparent, and convenient solutions for their personal financial situation.
CFSP members have adopted government-recommended measures to limit the spread of the virus and protect our customers and employees, while also continuing to help consumers during this unprecedented time by:
• Working with every customer to give them the flexibility and understanding they need.
• Offering solutions based on what will work best for their situation, so that they can effectively manager their financial obligations and help family and friends.
• Cautioning consumers to avoid unregulated on-line lenders and other fraudulent providers, and to be on the lookout for scams, as regulators and news reports suggest and uptick during this crisis. 2
CFSP members' customers have voiced relief to know our industry is still here for them during this challenging time. Even amid the most trying circumstances, our members continue to receive overwhelmingly positive feedback and reviews form their customers.2 Real-world customers understand and value CFSP member's services.
1 During this challenging time, CFSP members have not experienced an increase in demand for small-dollar loans and other services, in fact, visits to our stores are down significantly. National database provider Veritec issued a COVID-10 impact report, revealing that small-dollar lending volume has been consistently and substantially down for much of 2020 relative to the same period in 2019, including a drop of nearly 70% at the pandemic's peak in early May. State regulator and database reports, including California, further confirm the dramatic decline in small-dollar lending.
2 In addition, the regulated consumer financial services industry is the subject of very few complaints. For instance, complaints to the Consumer Financial Protections Bureau regarding short-term, small-dollar loans during the pandemic accounted for just a fraction of 1 percent of the record 450,000 complaints received in 2020 - a 55% drop relative to 2019 complaints. Among these few complaints, an even smaller percentage are about regulated consumer financial services providers, and their services.
Amid the uncertainties and anxieties resulting from the COVID-19 pandemic, as many families confront magnified challenges, financial liquidity is especially critical. Members of CFSP, representing the diverse and innovative consumer financial services industry, have been designated "essential" throughout the pandemic. We have continued to operate locations throughout California, and on-line, offering critical financial services to millions of Californians, particularly middle-income, working families, who value and choose our simple, reliable, convenient services. We are proud to be there for our customers and communities during this unprecedented time, committed to providing consumers with regulated financial inclusion, and stability.
Consumers' Financial Needs
The Covid-19 pandemic and related economic crisis are the latest tests to our country's ability to provide financial inclusion and stability to all American consumers. Before this crisis, the Federal Reserve reported that nearly 40 percent of American adults needed to borrow or sell something to cover a $400 expense, or were unable to cover it at all. Today, those challenges no doubt remain very real for many. In fact, a Bank rate survey from January 2021 found that fewer than four in 10 Americans could absorb the cost of an unexpected expense of $1,000, such as a care repair or emergency room visit.
Regulated consumer financial services providers have long played a vital role in California, and the nation's, financial services landscape, equipping consumers with access to a variety of solutions to help manage their personal finances. This necessary function has been recognized prominently and consistently throughout the pandemic, with the Department of Treasury, the Department of Homeland Security, and California designating our industry as critical financial infrastructure. Embracing this responsibility, CFSP members, which span large companies with national reach to small "mom and pops" - have stayed open and operating throughout the pandemic, even when many other, more traditional financial institutions were closed.
Essential Financial Services
As millions of Californians struggle with financial hardship, our sustained operations have helped them to access wages and benefits, including stimulus payments; pay bills; aid family members and friends; and conduct other financial transactions in a regulated, licensed setting. CFSP members provide an array of basic financial products and services in storefronts across innovative, integrated platforms and channels, including:
• Check Cashing,
• Pre-paid cards (including offloading of funds),
• Domestic and international money transfers,
• Electronic bill payments, and
• Small dollar consumer loans.1
How We're Helping
For those customers CFSP members continue to serve, regulated consumer financial services provide an important lifeline for them and their families. As always, our customers carefully consider consumer financial services, weighing the costs and consequences of all of their options. Many find our products and services to be the most cost-effective, transparent, and convenient solutions for their personal financial situation.
CFSP members have adopted government-recommended measures to limit the spread of the virus and protect our customers and employees, while also continuing to help consumers during this unprecedented time by:
• Working with every customer to give them the flexibility and understanding they need.
• Offering solutions based on what will work best for their situation, so that they can effectively manager their financial obligations and help family and friends.
• Cautioning consumers to avoid unregulated on-line lenders and other fraudulent providers, and to be on the lookout for scams, as regulators and news reports suggest and uptick during this crisis. 2
CFSP members' customers have voiced relief to know our industry is still here for them during this challenging time. Even amid the most trying circumstances, our members continue to receive overwhelmingly positive feedback and reviews form their customers.2 Real-world customers understand and value CFSP member's services.
1 During this challenging time, CFSP members have not experienced an increase in demand for small-dollar loans and other services, in fact, visits to our stores are down significantly. National database provider Veritec issued a COVID-10 impact report, revealing that small-dollar lending volume has been consistently and substantially down for much of 2020 relative to the same period in 2019, including a drop of nearly 70% at the pandemic's peak in early May. State regulator and database reports, including California, further confirm the dramatic decline in small-dollar lending.
2 In addition, the regulated consumer financial services industry is the subject of very few complaints. For instance, complaints to the Consumer Financial Protections Bureau regarding short-term, small-dollar loans during the pandemic accounted for just a fraction of 1 percent of the record 450,000 complaints received in 2020 - a 55% drop relative to 2019 complaints. Among these few complaints, an even smaller percentage are about regulated consumer financial services providers, and their services.