Only Sharks in the Tank

2020 ◽  
pp. 93-113
Author(s):  
Terri Friedline
Keyword(s):  
Financial Services ◽  
Kansas City ◽  
Financial Protection ◽  
Doing Business ◽  
Alternative Financial Services ◽  
Payday Lenders

This chapter explores the coordinated relationship between banks and payday lenders by examining the recent attempts of the Consumer Financial Protection Bureau to regulate the payday lenders in Kansas City. While payday lenders and other higher-cost alternative financial services are criticized for their predatory practices, banks often escape a similar level of scrutiny despite their punishing fee structures and risk-based calculations. Both banks and payday lenders have largely escaped federal oversight. The disproportionate harms inflicted by payday lenders on Black and Brown communities are often treated as tolerable, perhaps considered causualties of doing business to dismiss these lenders from the oversight they deserve.

How positive service experiences contribute to service captivity

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Constantino Stavros ◽  
Kate Westberg ◽  
Roslyn Russell ◽  
Marcus Banks
Keyword(s):  
Financial Services ◽  
Financial Vulnerability ◽  
Socially Responsible ◽  
Content Type ◽  
Welfare Policies ◽  
Regulatory Frameworks ◽  
Alternative Financial Services ◽  
Service Experiences ◽  
Service Relationship ◽  
Practical Implications

Purpose Service captivity is described as the experience of constrained choice whereby a consumer has no power and feels unable to exit a service relationship. This study aims to explore how positive service experiences can contribute to service captivity in the alternative financial services (AFS) sector for consumers experiencing financial vulnerability. Design/methodology/approach A total of 31 interviews were undertaken with Australian consumers of payday loans and/or consumer leases. Findings The authors reveal a typology of consumers based on their financial vulnerability and their experience with AFS providers. Then they present three themes relating to how the marketing practices of these providers create a positive service experience, and, in doing so, can contribute to service captivity for consumers experiencing financial vulnerability. Research limitations/implications The benefits derived from positive service experiences, including accessible solutions, self-esteem, and a sense of control over their financial situation, contribute to the service captivity of some consumers, rendering alternative avenues less attractive. Practical implications AFS providers must ensure a socially responsible approach to their marketing practices to minimize potentially harmful outcomes for consumers. However, a systems-level approach is needed to tackle the wider issue of financial precarity. Policymakers need to address the marketplace gaps, regulatory frameworks and social welfare policies that contribute to both vulnerability and captivity. Originality/value This research extends the understanding of service captivity by demonstrating how positive service experiences can perpetuate this situation. Further, specific solutions are proposed at each level of the service system to address service captivity in the AFS sector.

Unbanked status and use of alternative financial services among minority populations

2019 ◽  
pp. 1-14 ◽  
Author(s):  
Silvia Helena Barcellos ◽  
Gema Zamarro
Keyword(s):  
Financial Literacy ◽  
Financial Services ◽  
Economic Status ◽  
Large Fraction ◽  
Explanatory Power ◽  
Primary Data ◽  
Wealth Accumulation ◽  
Alternative Financial Services ◽  
Underlying Causes ◽  
Racial Ethnic

AbstractA large number of Americans do not have bank accounts (the ‘unbanked’) or rely on costly alternative financial services (AFS) such as payday loans (the ‘underbanked’), with implications for wealth accumulation and retirement preparedness. Using primary data, we document large racial/ethnic differences in unbanked and in frequent AFS usage rates. We study the role of socio-economic status (SES), financial literacy, trust in financial institutions, networks, and time preferences in explaining these gaps. While these variables explain a large fraction of the white-minority gaps in unbanked status the same is not true for gaps in AFS use. A Blinder-Oaxaca decomposition confirms these patterns: gaps in unbanked status are mostly explained by differences in endowments across groups, for AFS gaps differences in returns to endowments have the largest explanatory power. Our findings suggest that, while related, unbanked and underbanked are distinct concepts with different underlying causes that may require different policy responses.

Financial relations small business energy complex

2016 ◽  
Author(s):  
Natalya Morozko ◽  
Valyentina Didyenko
Keyword(s):  
Small Business ◽  
Financial Planning ◽  
Financial Services ◽  
Small Businesses ◽  
Energy Sector ◽  
Small Organizations ◽  
Developed Economies ◽  
Energy Complex ◽  
Financial Condition ◽  
Alternative Financial Services

The paper deals with the peculiarities of small organizations in the energy sector, taking into account the principles of effective financial cooperation of small businesses with a variety of large and medium-sized structures. We studied the experience of the financial relations of countries with developed economies on a set of market tools and in business management in the energy sector. The analysis of the financial condition of small organizations and energy sector. Defined financial planning tools of organizations that allow to carry out the relationship of financial planning practices with the main objectives of a small organization. Reasoned application of the tax policy in the system of financial relations for small and large businesses and energy complex. The conditions for the use of alternative financial services market lending small business operations using efficient technologies.

Policies could damage Tanzania’s strong growth trend

2017 ◽  
Keyword(s):  
Tax Evasion ◽  
Financial Services ◽  
Growth Trend ◽  
Sharp Drop ◽  
Content Type ◽  
Doing Business ◽  
The World ◽  
Ease Of Doing Business ◽  
Tourism Revenue ◽  
Growing Population

Significance The World Bank’s 2017 Ease of Doing Business ranking shows Tanzania improving, moving up to 132nd place from 144 last year. However, an austerity drive and a crackdown on tax evasion may undermine progress. Businesses have shuttered since President John Magufuli took office, and commercial retrenchment could dampen key growth sectors including construction, telecoms and financial services. Impacts A fast-growing population of 53 million will add to an already large consumer base. A sharp drop in tourism revenue could prompt a review of taxation on the sector. Natural gas discoveries could boost revenue, but exports will only begin in the next decade.

scholarly journals Access to Banking and the Role of Inequality and the Financial Crisis

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Mauro Caselli ◽  
Babak Somekh
Keyword(s):  
Interest Rate ◽  
Financial Crisis ◽  
Financial Services ◽  
Income Disparities ◽  
Consumer Population ◽  
Alternative Financial Services ◽  
The 2008 Financial Crisis ◽  
The Interest Rate ◽  
Distribution Of Income

Abstract We study access to banking and how it is related to banks’ rate of return on investments and the distribution of income. We develop our empirical framework through a theoretical supply-side model of bank deposit services with a consumer population heterogeneous in income. We use this model to show how decreases in the interest rate margin and higher income disparities lead to an increase in the proportion of unbanked. Using localized US household data from 2009, 2011, 2013 and 2015 we find strong empirical evidence for the predictions of the model. We then structurally estimate our model to estimate the value of having a checking account relative to alternative financial services and to quantify the effects of actual changes in the interest rate margin and the distribution of income that occurred in the aftermath of the 2008 financial crisis.

Application of cloud computing in financial services: an agent-oriented modelling approach

2018 ◽  
Vol 13 (4) ◽  
pp. 994-1006
Author(s):  
Subhas C. Misra ◽  
Kriti Doneria
Keyword(s):  
Cloud Computing ◽  
Financial Services ◽  
Decision Makers ◽  
Content Type ◽  
The Public ◽  
Similar Work ◽  
Doing Business ◽  
Trade Offs ◽  
Modelling Approach

Purpose Cloud computing is rapidly becoming the new norm of doing business. Lately, the extent of virtualization has enabled full-fledged cloud solution to become affordable, quantitatively and/or qualitatively. The purpose of this study is to explore the former in detail. In this paper, implementation of cloud-based services in the financial services, intermediaries and banking industry where security has always been the greatest concern are studied through actor-based stakeholder modelling. Drivers for adoption, benefits and trade-offs and challenges have been discussed in detail through a hypothetical comprehensive case study of a bank. Design/methodology/approach An actor-dependency-based technique for analyzing and modelling requirements prior to changes and charting out roadmap and rationale behind it all has been used. Through the use of i* modelling, dependencies and relationships between various stakeholders have been studied. Further, how decision makers in the financial services industry evaluate, consolidate and finally migrate to a new architecture is also explored. Findings Two hypothetical use cases on a hypothetical bank referred to as “The Bank” illustrate the technique and possible roadmap for implementation. Originality/value To the best of knowledge in the public domain, no similar work has been carried out with the perspective of modelling stakeholders and change management configuration in the financial services using cloud. This approach is valuable for augmenting technological advancements with business insights and spotting value in synergies of the sectors whenever and wherever apparent.

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