The recent news about JP Morgan Chase and the $2 Billion dollar market loss may have scared The White House, as one of the nation’s stronger banks was the originators of this loss. The White House may want to consider another analysis of the $2 Billion dollars lost in market trading. In the new normal, one of three Americans are considered underbanked which is defined by individuals being excluded from the mainstream banking and may use check cashing services as banking alternative. JP Morgan Chase and other commercial banks are profit driven, and focus on profits leave no room for the underbanked in the commercial banking world. The banking industry does not look at a long-term strategy when the topic is the underbanked. The financial health of the consumer is a direct impact to the real economy. The benefit of bringing the underbanked into the mainstream banking umbrella to promote a vibrant, healthy financial consumer base goes to the economic growth of the real economy.  The $2 … [Read more...]

The buzz words in the credit union industry are Member Business Lending. The reason for the buzz is legislation before Congress to allow credit unions to increase business lending to be raised to account for no more than 27.5% of total assets up from 12.25% on the books. The passage of the legislation would be a boost to the credit union and small business as this will open additional avenues of financing that has been restricted by the commercial banking industry. The credit union faces a tough fight as commercial banks attempt to focus on the inexperience and risk in allowing the credit union into the business lending market. The one fact is certain that commercial banks have not met the fiduciary responsibility to meet the lending needs of the small business community in recent years. The passage of the pending Member Business Lending legislation would allow more financing options to the small business community. The argument of inexperience in business lending can be negated … [Read more...]