Everything is bigger in Texas!

by The CAB Man Texas on October 27, 2016

Howdy folks – I saw this really great article in the Houston Chronicle titled “FDIC: Texas leads the country in ‘unbanked’ households.” This was another reminder that we are in one heck of a strong market.  Yep, everything is bigger in Texas!

This article tells me many things, but my first instinct is that it likely banks have made it so unattractive to work with them in Texas that many people (“unbanked” or “under banked”) simply prefer to go another route versus the traditional bank.  And, banks actually turn away many of the customers we serve for what I think are unfair reasons.  Many of our clients are very pleased to work with these customers and would like to ask for their business.  Whether the clients offer payday loans, cash advances, title loans, installment loans, or check cashing…it is quite likely they can suit the needs of the consumer.  Banks are lazy; customers in our industry typically need some above the norm assistance while carrying higher amounts of risk. Our clients understand this and will do the work with the customers seven days a week, in-store, online, via phone, email, or text!

Despite the fact that banks are being shunned for their unfair treatment (ahem, Wells Fargo) of U.S. consumers, and despite the fact that more consumers are saying “no thanks” to the local bank branch, the banks still make 4-5 times more revenue on overdraft / NSF charges than the entire “payday loan” industry makes in annual revenue last I checked.  Perhaps the CFPB should spend less time on our industry and more on the banks!

Using 2015 data, the FDIC measured “economic inclusion,” which is the term they use to label families who use mainstream financial institutions.

The study estimates how many households are unbanked, or don’t have bank accounts, and how many are under banked, or may periodically seek financial help from services such as title loans, payday loans and pawn shops despite having bank accounts.

Here are some statistics cited in the article:

  • 9.4 percent of households, or about 967,000, were unbanked in 2015.
  • 23.7 percent of Texas households were under banked.
  • Income of less than $15,000 per year: 25.6 percent unbanked, 29.5 percent under banked.
  • No high school diploma: 28.8 percent unbanked, 26.7 percent under banked.
  • Ages 25-34: 13.8 percent unbanked, 27.1 percent under banked.
  • Ages 35-44: 12.8 percent unbanked, 27.7 percent under banked.
  • About 16 percent of African American households were unbanked and 30 percent under banked.
  • About 18 percent of Hispanic households were unbanked, with 30 percent under banked.
  • In Texas, unbanked households logged the lowest savings rates at 17.7 percent.
  • Savings rates rose to 49.5 percent for under banked households and 59.5 percent for those considered “fully banked.”

What should business owners in our industry be thinking as they read the article?  What are the behaviors/traits of our customers?  How do we mold our services so they are in line with the behaviors/traits?  What services should we add and evolve into?


This blog post was written by Michael Brown, President of CAB Consulting and the Texas Organization of Financial Service Centers.  He can be reached at 214-293-8676, or Michael@CreditAccessBusiness.com.


Today invitations to the 5th Annual TOFSC Conference are being sent out to Members, Sponsors, and Vendors, requesting their attendance starting at 10am on Wednesday 9/14.

We have chosen the Hyatt Regency Lost Pines for the venue this year, which is situated 20 minutes east of the Austin Bergstrom Airport near an 1,100 acre nature park called McKinney Roughs.

It is going to be a great setting and as always a great occasion for us to build relationships and do some learning.  Members are already sending in their attendance forms.  See below for links to the forms:

For Members: TOFSC.Conference.Invite.2016.Members

For Vendors / Sponsors: TOFSC Conference Invite 2016- Vendors

If you have any questions call or email Michael Brown, President of TOFSC, at 214-293-8676, or email him at: Michael@CreditAccessBusiness.com.


CFPB Payday Loan Complaint volume continues to fall.

December 11, 2015

Each month the CFPB releases a complaint report that shows complaint volume by product.  The September, October, and November 2015 reports show that “payday loan” complaints were down by double digits when compared to the same period in 2014: -12% over the same 3-month period of June-July-August 2014. (September 2015 report: http://files.consumerfinance.gov/f/201509_cfpb_monthly-complaint-report-vol-3.pdf). -24% over the […]

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New CAB rules on the way – so how are we not regulated?

November 20, 2015

Adversarial media and consumer advocate groups like Texas Appleseed like to continually throw legislators and regulators under the bus for “turning their backs on Texas consumers” by not regulating payday, installment, and auto title lenders.  So, first of all let me come to their defense by saying I have worked with many of the good […]

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New Rules for Texas Credit Access Businesses

October 23, 2015

The 2015 Texas legislative session passed a “Clean Up Bill”, which authorized the OCCC to review, repeal, and replace rules regulating CAB’s.  Those new changes were proposed in September for pre- comment and voted for approval by the Texas Finance Commission Board to be published in the Texas Register on October 16, 2015 (last Friday) at […]

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Budget Cuts Could Cause Delay In Tax Refunds

December 19, 2014

A friend forwarded me an article today from the Associated Press. The article was titled “IRS head says budget cuts could delay tax refunds.” This could have a number of trickle-down effects on taxpayers expecting a their tax refund sooner than later. As well, many companies who serve those people can also be negatively impacted. […]

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Kennesaw State Study on Payday Industry

December 11, 2014

This week a study on the payday industry was released by Professor Jennifer L. Priestley at Kennesaw State University. This is exactly what we need more of – a close look at large amounts of actual data and statistics on use of payday loans and their array of impacts on consumers. Opponents of the payday […]

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Texas Legislative Session Starts January 13, 2015

December 8, 2014

The 84th Texas Legislative Session gets underway in just over a month.  Session starts on Tuesday January 13th, 2015.  So far from what I can tell there have been (3) bills filed having to due with payday loans, installment loans, and/or auto title loans. The Texas Legislature meets in a regular session every two years, […]

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2014 TOFSC Conference Invites have been sent!

August 18, 2014

The 2014 TOFSC Conference invites were sent out today.  Looking forward to hearing from Members, Vendors, other other invitees on attendance. Attendance forms were sent out on email, see below for that form if you did not receive one.  Send completed forms to Michael Brown via email or fax.  Michael@CreditAccessBusiness.com or 888-561-0986. The conference will […]

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Invitation to the OCCC Webinar on June 26th

June 17, 2014

The OCCC sent out an invitation to Credit Access Business stakeholders today to a Webinar titled “What is a Credit Access Business?”  CAB Consulting has registered for the webinar and we look forward to attending on June 26th at 2pm CST. Here are some of the topics that will be covered: – Review of Licensing […]

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