Friday, December 12, 2014

Follow up article on the 'un-banked' discussing the huge profits the financial industry makes off those without bank accounts.

Earlier this year I did a post about the very powerful movie called SPENT.  It was about the unbanked population and how they face a difficult burden be existing outside the traditional banking system.  I came across this article today which relates to SPENT and thought I'd share.

Click here for the original post which contains the movie.

THE $103B BANK REVENUE STREAM [click to see original source]

News, Alternative Financial Service, Payment Methods- Dollars
What's Next In Payments®
6:14 AM EST December 12th, 2014
Financially underserved consumers now spend more than $100 billion a year on financial fee and interest charges, according to a report released Thursday (Dec. 11) by the Center for Financial Service Innovation.
The CFSI estimated that underbanked U.S. consumers used $1.3 trillion in financial products and services in 2013 and spent $103 billion on the nonbank charges, up 7.1 percent from 2012’s $96 billion in charges. In 2014, that spending is projected to grow 4.6 percent to $107 billion, Credit Union Times reported.
Much of the growth came from expansion in subprime auto lending and auto leasing, which has been crowding out more expensive “buy here, pay here” auto-sales outlets.
Another growing niche: credit cards. “The increasing availability of subprime credit through credit cards has brought renewed strength to consumer solicitations and approvals in the Subprime Credit Card segment, a trend projected to continue in 2014,” the CFSI wrote. Secured credit cards also saw a sharp jump in revenue, driven by a 30 percent jump in average fees from 2012 to 2013. But those fees are expected to plateau in 2014.

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