The well documented failures of Silicon Valley and Signature Banks have raised fundamental questions about the role of federal regulators, the importance of regional vs. national banks, as well as the overall state of the U.S. economy.
Questions about the economy were part of the discussion between members of the U.S. Senate Finance Committee and Treasury Secretary Janet Yellen last week. When asked about the state of the U.S. banking systema and what it could mean for consumers and businesses alike, she responded: “If banks are under stress, they might be reluctant to lend. We could see credit become more expensive and less available.”
Secretary Yellen’s comments are a reminder that consumer don’t look to just banks for credit. There are millions of American consumers who do not have a bank account. Millions more do not qualify for bank loans due to less than stellar credit. These consumers typically look to finance companies for their credit needs.
But regardless of what type of credit consumers access, higher interest rates from the Federal Reserve increase costs for lenders. Lenders respond to higher costs in different ways, including lowering the lending risks by tightening their lending requirements, passing those cost increases onto consumers, or reducing their expenditures with layoffs.
The current financial churn is also a reminder that other policies can further limit access to credit, such as caps on annual percentage rates. This all contributes to an economic environment that harms the types of consumers who may need a loan the most: the non-bank-account-holding consumers with a few dings on their credit reports, who probably will never need a bailout, but would most likely appreciate knowing they have access to an affordable form of credit an emergency expense pops up.
The well documented failures of Silicon Valley and Signature Banks have raised fundamental questions about the role of federal regulators, the importance of regional vs. national banks, as well as the overall state of the U.S. economy.
Questions… Read the rest

The Inside Track with RSM
AFSA’s breakout sessions always put attendees in the know and on the inside track, and this session is a must-attend for leaders looking to grow their businesses.
Join industry experts from RSM as they present… Read the rest
On Wednesday, April 19, the Aria Resort and Casino in Las Vegas will be buzzing with AFSA’s first solutions showcase, bringing together new AFSA Business Partner products and services that can help transform consumer credit operations. … Read the rest
Current trends in the economy and the automotive market suggest that auto loan delinquencies and repossessions have increased. But Cox Automotive Chief Economist Jonathan Smoke thinks that what we’re looking at is more a return to normal
…
Read the rest
Affordability and creditworthiness are two key factors – really the two key factors – that determine whether Americans can get access to the credit they need. Unfortunately, rate caps have made affordable credit, especially… Read the rest
AFSA is celebrating Women’s History Month with a special Extra Credit Podcast series, Industry Icons, featuring outstanding female leaders in the consumer credit industry. This episode features Marguerite Watanabe, President,… Read the rest
AFSA CEO Bill Himpler testified this morning before the House Financial Services Subcommittee on Subcommittee on Financial Institutions and Monetary Policy about the Consumer Financial Protection Bureau’s (CFPB) refusal to operate … Read the rest

AFSA’s breakout sessions always put attendees in the know and on the inside track. Join Jason Dunn, former U.S. Attorney, former Colorado Deputy Attorney General, now a Brownstein Hyatt Farber Schreck Shareholder for a “State… Read the rest
Recent research by economist Jonathan Lanning, formerly of the Consumer Financial Protection Bureau (CFPB) and currently with the Federal Reserve Bank of Chicago, documents racial and ethnic disparities in indirect auto loans.
Using … Read the rest
Today is International Women’s Day, when the global community comes together to celebrate women and serve as a focal point in bringing attention to important issues, such as gender equality.
It is also a great time to highlight what … Read the rest