Payday loan businesses both large and small are doing a lot of things right, profits are strong and many have a very positive outlook.

But, what more can be done to improve the customer’s experience with your company?  Are payday businesses taking stock in what really matters to their customers beyond just the loan transaction?

Where is the customer going after they leave you?  What is going to be done with the money?  Just about all you need to know can be learned by following the trail before and after they come to see you.

Once you have studied customer behaviors, how about taking that knowledge and investing it in programs that are custom tailored to those pathways?  Create a full suite of customer programs that target the issues that cause customers to need your service in the first place. Then compliment that with programs aimed at your customer’s journey after they leave your store.

Examples of programs that might fit this mold: in-store instant bill payment, ATM, internet access for customers, credit improvement, debt consolidation, fax machine usage, rewards programs, gas cards, gift cards, lottery tickets, coupons, text communications, job boards, resume services, child care, health care services, legal representation, etc.

Seek relationships with 3rd party companies who have partner, referral, or affiliate programs.  You will not just be providing additional benefits to your customers, but you can also generate some serious revenue.  These companies are out there, I know of many and they are working hard every day to get involved with our industry.

Trusted payday lenders are uniquely positioned to improve the lives of their customers and a well organized array of programs will only further that value.  It will make your business competitive, interesting, and maybe even cool!  Think about the positive impact that will have on new customer flow, referrals, and bad debt…

There is a lot of legwork that goes into finding the right programs, and ideal 3rd party vendors.  C.A.B. Consulting and Brokerage does have existing relationships in these areas, if you would like to discuss options and learn more, email Michael at cabconbrokerage@gmail.com or call 214-293-8676.

This bill is the second to be authored by Anchia, and is “relating to the repayment of certain extensions of consumer credit facilitated by a Credit Access Business.” CAB’s will need to offer extended payment plans under this bill, where customer would be eligible if certain conditions are met. The conditions are: no plans within the last 12 months with that CAB, the loan has been refinanced at least 4 times, and the plan was requested before the loan went into default. The plans must be requested in writing and be signed by the CAB and the consumer. The CAB cannot charge fees or other charges under the plan, the plan must be 4 payments of equal amounts, and the client would need to be “paid in full” after the final payment, consumer may prepay with no penalty. During the plan, CAB cannot assist consumer in finding additional credit, may not engage in debt collection activity, so long as customer stays on plan. Regarding normal payment schedules on loans in good standing – the bill makes the requirement that multi-payment programs must be fully amortizing, declining principal, with close to equal payments, this was also in HB 886. Also, make note that CAB fees must be refunded if un-earned on an early payoff. The bill goes on to site many of the same existing requirements that we have now, also that the extended payment plan notice must be viewable in store. Goes into effect on 9-1-2013.

Click here for a PDF version of HB 1040! HB.1040

Check your work!  Last week my team and I released a blog about Carlos Uresti, a San Antonio based Senator whose offices had been raided by the FBI.  We happened to know that a politician by the name of Uresti in the San Antonio area had also written a bill that would attempt to “cap” all finance charges on Credit Access Business payday, installment, and auto title loans to 25% of the amount borrowed.  Being that I am a rabid defender of our CAB clients, I sprang on the name “Uresti” immediately and assumed he was the same man who had written the bill – which was House Bill 1733.

We made two mistakes on the blog post.  First, State Rep. Tomas Uresti wrote House Bill (“HB”) 1733 and Carlos Uresti did not.  Second, we should have known that a Senator would not write a “House Bill” because they are not in the “House,” they are in the Senate!    This was one day that our team totally messed up on the details – the blame is on me.

These errors were sharply pointed out to me and we pulled down the post right away.  We have a lot of people reading our posts and people count on us to relay information.  It is important to make sure we get them right. This oversight is a fresh reminder that the good old fashioned saying “the devil is in the details” is alive and well.

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.

The O.C.C.C. is getting very close to releasing the Credit Access Business License application. It could be another 7 to 10 days, if so that may be Friday, October 21, 2011.

The next O.C.C.C. Finance Committee meeting also happens to be on Friday, October, 21st 2011. In the meeting the “Consumer Disclosure Form for Credit Access Businesses” will be presented along with its accompanying rules. I was recently updated and given a sample document which illustrates some of the disclosures that will be required for a single payment payday loan. There will also be other versions and sample documents released for multiple payment payday loans, single payment auto title loans, and multiple payment auto title loans.

See below for a link to the document – take a look and tell me what you think. Again, this is only one sample and it is not for use in operations. Do you have any comments you wish to make about the disclosure form? Do you feel like this is too much information? Can you easily work this into your process? after you post your comments I will relay them to the Finance Committee.

OCCC.Sample.Disclosure.Form

Submit comments to me via email at cabconbrokerage@gmail.com

There is some funny money making the rounds in Abilene and the East Texas region.  There were two incidents recently that were uncovered.  The way money usually works is that it will circulate in a region so I want to make sure everyone is upping the amount of attention put towards identifying counterfeit bills.

Incident #1: Fake ‘movie’ money used at movie theater and other Abilene businesses (KTXS News).

Abilene police are investigating a case they hope will have a Hollywood ending.  APD’s Fraud Unit says suspects have made purchases at more than 20 local businesses using counterfeit bills made specifically for use in the movies. Ironically, one of the places that accepted the funny money was a movie theater.

Link: http://www.ktxs.com/news/fake-money-used-as-movie-prop-circulating-in-abilene/167827285

Incident #2:  Movie money found in East Texas.  (Longview Journal)

There have been additional news articles on the use of the counterfeit “movie” money in East Texas as well.  The Longview Journal posted an article that the “movie” money has been reported in other parts of East Texas such as: Lufkin, Diboll, and Jasper.

Link: https://www.news-journal.com/news/2016/aug/29/fake-movie-money-hits-et/

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.

Looks like the Payday Loan ordinance conversation on the City Council in El Paso will potentially resume on January 2nd. Initially, it was proposed that City Attorneys draft a final version of the ordinance and have it ready for review today. However, that has changed since. Perhaps the El Paso City Council has spoken its opinion and now they are ready to let the Legislature address the matter…

Since the December 6th news came that El Paso was now supporting local ordinances, I have been speaking with many operators about how to participate in the upcoming legislative session. The State of Texas should be the one who governs Payday and Auto Title Loans, not individual cities, and that point needs to be made in a new bill or amendment to an existing one. So, let’s all show our support and get involved in Austin. I am considering a plan to get involved and if you would like to know more, please contact me!

Last week I spoke with Cindy Ramirez at the El Paso Times and she quoted me effectively. We offer a much needed service, consumers respond to convenience, we intend ntend to operate legally and fairly. Here is the link to the El Paso Times article from yesterday: “Title-loan lenders will fight efforts of El Paso City Council to regulate”

http://www.elpasotimes.com/news/ci_22205745/title-loan-lenders-will-fight-efforts-regulate

As always, I am pleased to take your phone call at 214-293-8676. Or, email Michael Brown at Michael@CreditAccessBusiness.com.

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?

http://www.chron.com/business/retail/article/FDIC-Texas-leads-the-country-in-unbanked-and-10049320.php

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.

Looks like Houston is now jumping on the bandwagon with a payday and auto title loan ordinance of their own. It is a bit longer than the payday and auto title loan ordinances that I have seen in Dallas, San Antonio, Austin, and El Paso. Gets very much into specifics on the procedure side and is more realistic than other ordinances when it comes to rates, loan amounts, and re-finances.

I have been heavily involved in the topic of payday and auto title loan ordinances lately, and have been working with clients and other industry stakeholders on a lobby effort in Austin this session. In September, the Texas Finance Commission asked the legislature to consider the burden that multiple local ordinances place on businesses who operate in multiple locales. The Finance Commission requested that the legislature “consider amending the Texas Finance Code to more clearly articulate its intent for uniform laws and rules to govern credit access businesses in Texas.”

If this issue is important to you, let your State representatives know and don’t hesitate to check in with us!

Michael Brown of CAB Consulting can be reached at 214-293-8676 or via email at Michael@CreditAccessBusiness.com.

Did you know that for many the Back to School season each August is the second highest seasonal demand period for the payday industry?  Only the Christmas and New Year Holiday time frame beats Back to School in terms of seasonal demand. For Texas Credit Access Businesses offering cash advances, payday loans, or title loans, now is the time to invest in marketing to new and existing customers.  It is imperative that all of your marketing, promotions, social media, and referral programs are firing and connected.  Campaigns started as early as July 28th and are pushing hard until at least the first day of school. In Texas most have that date set at August 15th.   

Revenue and payment wise, many Members of our group still recall August of 2018 where we had (5) Fridays in the month and also with the way the calendar fell the 1st & 3rd pay dates fell in August, for August in September!  So those things alone meant a record number of payments due and a record revenue month for many.  While we do not have the same thing happening this month with the pay dates, we still have the increase in demand to focus on, so make that marketing happen now! Don’t forget to keep your teams happy, motivated, and focused this month as the workload can increase with higher demand and payment volume.

One great idea to for blog readers that is happening in Central Texas is doing back pack give-away promotion where new customers are entered for a chance to win back packs filled with a variety of much needed school supplies.  This has been warmly received by customers.  Social media has been showing the love with lots of shares and likes of the images we posted of the backpacks so that is very good.

How do we know Back to School demand is here?  There are a number of criteria that paint a very clear picture, for starters lead conversions were up, we saw 12% on one source versus mostly having been in the 5-10% range in prior weeks.

Another sign – loan volume is way up August 1st to 8th versus July 1st to 8th:

• Funding volume is doubled.
• New Customers doubled.
• Online applications up 38%.
• Reloans doubled.
• Increases tripled.
• Denials down 10%.

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.