The Consumer Financial Protection Bureau (CFPB) released on Tuesday, September 3rd the results of a pilot study called Planning for Tax-time Savings. Conducted in conjunction with H&R Block, the study found that simple messages encouraging customers to use the saving feature on their prepaid tax- refund credit card that is provided by tax-preparation firms, increases the likelihood that consumers would actually use the savings option.
The study was conducted during the 2017 tax season and randomly assigned a subset of H&R Block customers who accepted prepaid cards to receive tax refunds into three groups: one received a message encouraging them to save, a second received a message and a small $5 incentive to do so, and the third group received nothing.
The customers that received the incentive were more likely to use the savings feature on the card. The message without the incentive also increased savings. The proportion of consumers with savings in their accounts did decrease over time, however. Those with larger earned-income tax credits were more likely to save while those who used refund anticipation checks were less likely.
“One of my priorities is to move the needle in the number of Americans who can cover a financial shock,” said CFPB Director Kathleen Kraninger. “There are many statistics underscoring the lack of savings, including a recent one by the Federal Reserve showing that 40 percent of Americans would turn to credit to cover a $400 emergency. As the Bureau continues to identify solutions to encourage consumers to save, the results from this study shows that even with small encouragement, consumers will save.”
Encouraging consumer savings is an important part of financial health and security. AFSA members offer a variety of safe, affordable credit options for all types of consumers, and stand ready to offer that credit in both emergencies and for everyday spending. The AFSA Education Foundation similarly can provide financial literacy programming, including a focus on such fundamentals as how to open a savings account and to budget and save for emergencies.
The Consumer Financial Protection Bureau (CFPB) released on Tuesday, September 3rd the results of a pilot study called Planning for Tax-time Savings. Conducted in conjunction with H&R Block, the study found that simple messages… Read the rest
With 25% of aftermarket products cancelled before loan terms end, and 46 states mandating lenders process refunds in a timely and accurate manner, what are you doing to stay compliant?
Join us on September 12 at 2 p.m. ET for Mitigating Risks… Read the rest
AFSA this week submitted a comment letter to the Federal Communications Commission (FCC) on its Third Further Notice of Proposed Rulemaking on methods to eliminate illegal robocalls. The association’s comment letter reinforced… Read the rest
With 25% of aftermarket products cancelled before loan terms end, and 46 states mandating lenders process refunds in a timely and accurate manner, what are you doing to stay compliant?
Join us on September 12 at 2 p.m. ET for Mitigating Risks… Read the rest
AFSA’s State Government Affairs team sent a letter to the Commissioner of the Nevada Financial Institutions Division on SB 311 as a follow up to an in-person meeting with the division on August 22nd. Effective October 1, SB 311 would … Read the rest
AFSA will be making important IT infrastructure upgrades beginning at 6:00 a.m. ET on Wednesday, August 28. The AFSA website and social media accounts will not be impacted. However, AFSA staff will have intermittent access to their workstations… Read the rest
The AFSA Annual Meeting is right around the corner, and we are pleased to announce that The Wall Street Journal‘s Jason Riley will be a keynote speaker to our attendees. Riley, an award-winning editorial board member of The Wall Street… Read the rest
The Delaware Bank Commissioner this week will award $340,000 to schools, non-profits, and community organizations to fund financial literacy courses, according to a report from Delaware Public Media. The state last distributed financial-literacy… Read the rest
As the summer winds down and kids head back to school, it's a great time to reengage on the issues and opportunities facing the consumer credit industry. AFSA webinars are a great way to jump back in and get informed. Complimentary to AFSA… Read the rest
On August 13, 2019 the Federal Housing Finance Agency (FHFA) released a final credit score rule for Fannie Mae and Freddie Mac (the GSEs). This rule implements requirement that were enacted as part of the Economic Growth, Regulatory Relief,… Read the rest
