Economic Inclusion: 

Meeting the Financial Needs of 

Low- and Moderate-Income Consumers 

Through Financial Service Centers

Presented to: 

FDIC Advisory Committee 

on Economic Inclusion 

October 24, 2007 

Washington, DC 

Financial Service Centers Of America, Inc. 

Court Plaza South-East Wing 

21 Main Street 

Hackensack, NJ 07602 

(201) 487-0412 

www.fisca.org 
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Table of Contents

 Page 

I. Introduction................................................................................................................. 1 

II. Financial Service Centers: Serving 30 Million Customers ..................................... 1 

III. FiSCA Customer Survey: A Powerful Testimonial of Satisfaction........................ 2 

IV. Our Customers: Their Real Financial Needs ........................................................... 2 

V. Financial Service Centers: An Industry Responsive to Consumer Needs ............. 3 

VI. Financial Service Centers: Developing Innovative Products and Services ........... 4 

VII. Financial Service Centers: Innovations in Consumer Empowerment................... 5 

VIII. Financial Service Centers: Leaders in Compliance................................................. 6 

IX. Financial Service Centers and Banks........................................................................ 7 

X. The Matter of Small Dollar, Short-Term Loans ...................................................... 8 

XI. Calls to Action: 10 Proposals to the Advisory Committee ..................................... 9 

XII. Conclusion ................................................................................................................. 10 

Attachments............................................................................................................... 11 
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I. Introduction 

Non-bank financial service centers (FSCs) have been providing financial services to millions of 

consumers for more than 70 years-forging real relationships with the communities and customers they 

serve. These services are provided with the highest degree of customer service and respect, resulting in 

extraordinary levels of customer satisfaction. FSCs also provide a gateway to the banking system for 

many of these individuals. 

Financial Service Centers of America (FiSCA) is the trade association representing the expanding FSC 

industry. FiSCA’s membership is nationwide and provides an extensive array of consumer financial 

services. Our breadth and depth of experience places us in a unique position to assist the FDIC 

Advisory Committee on Economic Inclusion (ComE-IN) in understanding and serving low- and 

moderate-income consumers. 

FiSCA is in agreement with the FDIC and the Advisory Committee on the need for “economic 

inclusion.” Where the industry and millions of FSC customers depart from the conventional wisdom of 

those who make policy is the policy makers’ focus on the predisposition that the best mechanism for 

economic inclusion is through direct relationships with banks. FSCs do not believe that low- and 

moderate-income consumers are “economically excluded” or “financially illiterate” simply because 

they choose to satisfy their financial needs with providers other than banks. In fact, the success of 

FSCs bears out almost three decades of research by the Federal Reserve System which shows that 

millions of low- and moderate-income consumers have little or no interest in direct banking 

relationships. 

It is FiSCA’s goal that the Advisory Committee will come to better understand the FSC industry and 

will recognize that integrating the industry into a comprehensive national plan for “economic 

inclusion” is a better alternative than attempting to force consumers into a “one-size-fits-all” strategy. 

FiSCA further submits that the Advisory Committee can take revolutionary steps by engaging in 

meaningful dialogue which will lead to actions that will enhance the delivery of financial services 

to consumers. The first step would be to adopt the 10 Proposals set forth in Section XI (Calls to 

Action) of this Presentation. 

II. Financial Service Centers: Serving 30 Million Customers 

The Financial Service Center industry is a formidable national, and economically significant, force that 

plays an integral role in the financial framework of millions of American households. Through its 

13,000 locations nationwide, the industry conducts more than 350 million transactions each year, 

providing an estimated $106 billion in various products and services to an estimated 30 million 

customers. Those transactions include more than $58.3 billion in check cashing transactions, $17.6 

billion in money orders sold, $8.3 billion in wire remittances, $13.2 billion in payday advances, and 

$5.4 billon in sales of pre-paid stored-value cards. (Attachment 1). 
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III. FiSCA Customer Survey: A Powerful Testimonial of Satisfaction 

Consumers choose to utilize FSCs because the products and services match their needs and they are 

highly satisfied with the way in which their transactions are conducted. Through a national customer 

satisfaction survey of the FSC industry conducted by Cypress Research Group in 2006 (Attachment 2),

the data collected underscored that: 

 8 in 10 of customers rated most features of their experience at member financial service centers as 

either ‘excellent’ or ‘very good’; 

 92% of survey respondents rated the overall value of the money of the services received from good 

to excellent; 

 95% of respondents rated the overall quality of services received as good to excellent; 

 75% indicated that stores clearly communicate all costs of products and services; 

 63% had been customers of the location for at least one year, while one-in-five (21%) had been 

customers for five or more years. 

This data provides a powerful testimonial from the customers themselves, who utilize FSCs. 

Furthermore, in October of 2007, Synergistics Research Corporation, an independent, nationally 

recognized provider of consumer research for the banking industry, concluded: “The unbanked choose 

to use FSCs because of convenience, the right services and the right price . . . (they) exist because they 

serve people’s needs . . . the unbanked choose FSCs because of the unique product mix, immediate 

access to cash . . . .” 

IV. Our Customers: Their Real Financial Needs 

Research on FSC customers extensive. The most significant finding from that research is that, for 

these customers, access to their money is a real issue. Tying up access to their cash through minimum 

balance requirements, mandatory deposit amounts, or other restrictions, is not an option, although often 

required by banks and traditional financial institutions. High fees charged by banks for services, 

particularly penalty charges, further alienate these consumers and place any related services out of 

reach. 

The needs of low- and moderate income consumers are both basic and easy to identify: 1) immediate 

liquidity for paper checks (paycheck, benefits check, etc.); 2) the ability to pay bills, rent, etc., often at 

the last minute to avoid additional fees; 3) the ability to send money to relatives in other states and/or 

other countries; 4) a safe place to keep whatever cash remains after the first three transactions; and 5) 

access to small dollar, short-term, unsecured credit. Life in the modern economy gives rise to two 

additional needs: the ability to build or rehabilitate credit histories, and a form of digital currency to 

participate in the Internet economy. 

These consumers also need access to these services at times and locations that are convenient to them, 

and that suit non-traditional work schedules that leave little free time. They need the services to be 

provided in languages they can understand – frequently more than just English or Spanish – by staff 

that makes them feel comfortable and that reflects the culture, customs and colors of the neighborhood. 

They need products and services tailored to their unique needs, preferences and economic 

circumstances, rather than being served “stripped-down” versions of what is designed for more affluent 

consumers. 
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V. Financial Service Centers: An Industry Responsive to Consumer Needs 

Multiple independent studies have underscored that FSCs serve consumer needs well and provide 

direct access as deeply-integrated members of the local communities they serve. They provide flexible 

hours of operation to accommodate residents’ varying work schedules. Many locations are open seven 

days a week, even 24 hours per day. They know the language(s) of the community and they offer a 

more family-friendly environment than do banks or traditional financial institutions. 

A survey conducted on behalf of the U.S. Department of Treasury confirmed that FSCs: 

 Offer a wide range of financial services and perform transactions that are needed by the 

“underbanked” population; 

 Are convenient for their customers, because they are open more days and for longer hours than 

most banks; and 

 Offer convenient locations and provide services using the language preferences of their 

consumers.1

 

More recently, an analysis conducted by Synergistics Research Corporation of consumer opinions of 

FSC products and services cited similar reasons for the success of the industry. According to the study, 

77% of consumers select FSCs for their convenient locations; 70% cite convenient hours; and 64% 

note that FSCs provide “less hassle” than banks. (Attachment 3). 

The Financial Service Center industry has been successful because it satisfies the most fundamental 

needs of its customers. These are: 

 Liquidity: 

Banks expect and require that consumers operate on a deposit account relationship basis. That 

means they must put money into accounts before they can obtain services, and that they cannot 

draw down their accounts to a zero balance. Although widely misperceived as “free,” the reality is 

that monthly maintenance fees, minimum balance requirements, per check charges, non-sufficient 

funds charges, courtesy overdraft fees, and the like combine to make bank services anything but 

free. Many low- to moderate-income individuals and families cannot afford to leave funds in an 

account. From time to time, they need all of their money for necessities. FSCs make 100% of 

those funds available immediately, without overdraft or low-balance fees and penalties. 

 Access (Convenience): 

Low- to moderate-income consumers need convenience of access in the communities where they 

live and work. Demanding life-styles that may involve multiple jobs, variable work hours, family 

demands, childcare timetables and other issues mean that consumers need to conduct financial 

transactions where and when it is convenient, and in a safe environment where they feel 

comfortable and respected. FSCs maintain stores in the communities where these consumers work 

and live, offering flexible hours in stores that are accommodating. 

1

 The Center for Financial Services Innovation, BAI Webinar, September 20, 2007: “Check Cashing: A Good Acquisition Strategy 

for the Underbanked” by Jennifer Tescher, Director, Page 8; referencing the study conducted by Dove Consulting on behalf of the

U.S. Department of Treasury, “Survey of Non-Bank Financial Institutions”, April 4, 2000. 
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 Service

 Hardworking customers are pressed for time and need fast service, as well as trustworthy and 

reliable information. They also need much more than access to cash in order to function. FSCs 

provide a full range of services, from bill payments, debit cards, money transfers, transit system 

access cards, ATM access and a variety of other services. FSCs provide excellent service with fast 

moving lines, cashiers who speak the languages of the community, and who understand customers’ 

needs and concerns. 

 Transparency

Low- and moderate-income consumers need to manage tight budgets and cannot be subject to 

surprise fees and incomprehensible charges. When money is tight, an unexpected charge can be 

catastrophic. Unlike banks, all fees charged by FSCs are posted and known up front – there are no 

surprises. All fees are paid at the time of the transaction, at the point of sale. 

We note that former New York State Superintendent of Banks Diana Taylor, in an October, 2005 

address to FiSCA, recognized that FSCs are located “. . . where people have varying levels of comfort 

with the banking system for a broad range of reasons, from cultural to educational to personal 

preference. MSBs provide an alternative to banks - easy to access, and convenient in terms of cost, 

proximity to their markets and hours of operation. In addition, an MSB location may provide a wide 

variety other services.” 

John D. Hawke, former Comptroller of the Currency said in October 2004 “. . . the OCC recognizes the 

important role that check cashers and similar money services businesses (MSBs) play in providing 

financial services to segments of our society that do not have access to the banking system. Check 

cashers generally offer convenience, neighborhood locations and a variety of financial services that 

appeal to certain consumers.” 

Although former Comptroller Hawke was on the right track, he was incorrect when he stated that MSB 

customers do not have access to the banking system. It needs to be understood that: 1) a large 

percentage (58%) of FSC customers have bank accounts (Attachment 2), and many more could, but 

choose not to open accounts; and 2) many of these customers live and/or work in the vicinity of banks, 

yet still choose to conduct business at FSCs. 

VI. Financial Service Centers: Developing Innovative Products and Services 

In its dynamic evolution over 70 years, the Financial Service Center industry has, time and time again, 

developed innovative new products and services to meet the fundamental needs of customers, building 

on the basic services of check cashing, money orders and money transfers. The industry has 

seamlessly integrated new technologies into its product and service offerings, enabling customers to 

conduct transactions rapidly and securely. This allows low- and moderate-income consumers to enjoy 

benefits that would otherwise not be available to them. Through the entrepreneurial initiative of FSC 

owners, consumers now have widespread access to financial products and services that otherwise 

simply would not exist. 

Some of the products and services pioneered by the Financial Service Center industry include: 
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 Debit Cards/Stored-Value Cards 

In 2001, FiSCA members realized that their customers could benefit from a secure mechanism to 

handle the proceeds of their check cashing transactions. This need was not being met through 

programs offering Electronic Transfer Accounts and First Accounts, and banks were still not 

providing low-cost accounts to these consumers. In order to fill the need, FiSCA, at its own 

expense, partnered with NetSpend Corporation to pioneer and develop a stored-value card. Offered 

as a branded Visa or MasterCard, the NetSpend card acts as a virtual bank account, allowing 

consumers to park funds until they are needed. These cards also allow consumers access to 

electronic commerce. Commonplace now, this product was unheard of six years ago. Thousands 

of FSCs currently offer the NetSpend and other stored-value cards. Through this mechanism, 

customers have loaded billions of dollars of cash into virtual bank accounts. 

 Electronic Financial Services 

Decades ago, FSCs facilitated the complex process of wiring money to relatives in distant places. 

Later, FSCs pioneered the development and use of electronic bill payments, enabling consumers to 

pay bills electronically, often at the last minute, thereby avoiding costly late fees and penalties. The 

Financial Service Center industry was also at the forefront of the electronic delivery of government 

benefits (EBT) and other services. Not only did this type of service increase convenience and ease 

for consumers, it guaranteed immediate delivery of payments and remittances. 

 Bank/Credit Union and Financial Service Center Alliances 

In several states throughout the country, the Financial Service Center industry has entered into 

partnerships with credit unions and banks, enabling members of credit unions, and banked 

customers, to make deposits and withdrawals at FSC locations. Additionally, in New York, check 

cashers pioneered the PayNet Payroll Network, which provides check cashing services free of 

charge to employees of local companies, in coordination with banks. 

VII. Financial Service Centers: Innovations in Consumer Empowerment 

In addition to product offerings, FiSCA members have proactively pioneered and implemented 

programs designed to advance the overall financial well being of low- and moderate-income 

consumers. This “three-legged stool” is known as the FiSCA Consumer Empowerment Program. The 

FiSCA Consumer Empowerment Program includes: 

 Savings 

FiSCA spearheaded and initiated a National Savings Program. It negotiated a revolutionary 

mechanism, through which consumers can establish a no fee, FDIC-insured, savings account, 

through their NetSpend Card. Then, they can transfer money back and forth between the Card and 

their savings account at no cost. The Card is currently offering participants in the Savings Program 

a 5% annual yield on deposits, far more than cardholders could obtain at banks. The accounts 

require no minimum monthly balance to maintain. No other card product offered by on the market 

incorporates a savings element. 
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The FiSCA Savings Program has already accounted for the “economic inclusion” of tens of 

thousands of customers who have deposited approximately $44 million into savings accounts. 

Further, while FiSCA pioneered the development of the Savings Program to be offered through its 

members, the program has been expanded, and other businesses, such as convenience stores, now 

offer the Program, increasing the numbers of low- and moderate-income consumers who have 

access to the no-fee, no minimum balance savings account that can be accessed without ever 

entering a bank. 

 Financial Education

Current financial education programs do not adequately target the needs of many low- and 

moderate-income consumers because they teach about products and services these consumers do 

not use, or which are not accessible to them. They do not appropriately address the day-to-day 

financial realities and needs of these consumers. In recognizing this fact, FiSCA recently 

commissioned the development of the first of its kind “audience appropriate” financial education 

program which better reflects the demonstrated needs, preferences and behaviors of these low- and 

moderate-income consumers who choose to use FSCs. The program will also provide educational 

materials that apply when consumers are ready to transition to banks and/or credit unions. In 

addition to delivering this financial education program through FiSCA member locations across the 

country, it will also be designed for delivery through wider channels, such as cable television. 

 Credit Building

The need for a credit rating that is recognized by home and auto lenders, insurance companies, 

employers and others, is fundamental. Millions of Americans do not maintain traditional credit 

relationships and, therefore, are unable to develop credit files. As a result, they are unable to 

obtain badly needed credit. However, these same people pay rent, utility and other bills on a 

monthly basis without fail. Earlier this month, FiSCA announced a new partnership with PRBC®

(Payment Reporting Builds Credit). PRBC is an FCRA-compliant credit bureau that enables 

consumers to build a credit file and score, based on their history of making rent and other recurring 

bill payments, that can be used to demonstrate creditworthiness when applying for housing, credit, 

insurance, and employment. PRBC has been qualified as a “Community Development Service” for 

Financial Institutions by the Federal Reserve Board, Office of the Comptroller of the Currency, 

Office of Thrift Supervision, Federal Deposit Insurance Corporation, and the New York State 

Banking Department Through the credit scores provided by the FiSCA/PRBC Credit Building 

Program, it is anticipated that customers will get needed auto, mortgage and other loans at 

prevailing rates, get better rates on insurance products, and enjoy other benefits not previously 

available to them. 

VIII. Financial Service Centers: Leaders in Compliance 

“Check cashers have set the standard for the financial services industry in the fight against money 

laundering, financial crimes and terrorism.” James F. Sloan, former Director of FinCEN 

As this Advisory Committee is well aware, the MSB industry is subject to many of the same core Bank 

Secrecy Act (BSA) requirements as banks and other financial institutions. These requirements include 

currency transaction reporting for qualifying transactions in excess of $10,000, suspicious activity 

reporting, monetary instrument sales record-keeping for money order and travelers check sales, and 

recording requirements for electronic money transfers. 
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Check cashers and MSBs are now required to be registered with the Treasury Department, and are 

required under Section 352 of the USA PATRIOT Act to have compliance programs including written 

anti-money laundering (AML) policies and procedures, appointment of a compliance officer, employee 

training programs, and independent compliance examinations. 

The Financial Service Center industry has taken great measures to ensure wide-scale compliance. In 

1993 FiSCA issued two compliance manuals for the industry: The FiSCA Compliance Manual and a 

corresponding FiSCA Employee Handbook. These manuals were the first of their kind for the nonbank financial institution industry. They were highly praised by FinCEN and utilized by IRS as 

guidance materials in connection with Title 31 examination procedures. The manuals, which pre-dated 

USA PATRIOT Act requirements by nearly a decade, have been periodically updated and 

supplemented based on amendments to the BSA. 

Following the September 11, 2001 terrorist attacks and enactment of the USA PATRIOT Act, FiSCA 

issued a Model Anti-Money Laundering Compliance Program to assist the industry in meeting new 

requirements under the Act. The Model Compliance Program provides guidance to MSBs for 

development of internal AML policies and procedures, and employee training programs. 

In the Fall of 2004, FiSCA launched an Internet-based compliance training and examination program, 

which includes courses for both MSB tellers and compliance officers. The program is the first of its 

kind for the MSB industry; providing comprehensive and uniform training to those employees on the 

front line. The courses include training on the identification of structured transactions and other 

financial crimes particular to the services and products offered by check cashers/money remitter agents. 

To date, approximately 20,000 MSB employees throughout the U.S. have sat for the on-line courses 

and examination. 

IX. Financial Service Centers and Banks 

“MSBs play a vital role in the national economy, providing financial services to individuals who are 

not otherwise part of the mainstream financial system” and “[i]t is absolutely not OCC’s intent that 

national banks should be forced to sever their relationships with money service businesses.” Julie L. 

Williams, former Acting Comptroller of the Currency, March 25, 2005. 

Notwithstanding this well known quote from Julie L. Williams, the former Acting Comptroller of the 

Currency, it is well-known that for the past several years, the check cashing/MSB industry has 

experienced an epidemic of bank account closures resulting from undue regulatory pressure on the 

banks that serve the industry. The “bank discontinuance” trend endangers the legitimate, regulated 

MSB industry and its ability to deliver financial services and products. The MSB and banking 

industries representatives have come to understand that the account termination problem stems, in part, 

from a misperception among federal bank regulators and their examiners that MSBs are high risk 

accounts. Due to these pressures, banks have been required to direct more and more resources towards 

MSB customer compliance oversight. As a result of these increasing costs and regulatory pressures, 

many banks have simply decided to terminate accounts for their MSB customers. With the limited 

number of banks willing to serve the industry, a tenuous relationship exists in which a major decision 

by any one of a very small number of banks could create enormous chaos, the damage from which 

would directly impact customers. Furthermore, there is unfairness inherent in this discriminatory 

“redlining” of an entire industry. 
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The MSB industry suffers greatly from the misperception that it presents an inordinately “high risk” for 

money laundering activity as compared with other financial institutions or businesses. This is not the 

case. In fact, in October of 2002, former FinCEN Director James Sloan, appearing at FiSCA’s Annual 

Conference in Washington, DC, expressly stated that check cashers “do not represent a heightened risk 

for money laundering.” 

Furthermore, there are few actual cases involving check cashers and money laundering. Since 9/11, 

FinCEN has assessed a total of $35,000 in civil penalties against two check cashers for BSA violations 

– yet during the same period it has assessed many millions of dollars in penalties against banks and 

other financial institutions. Citing recent examples, BSA violations involving depositories frequently 

involve tens of millions of dollars. Since the passage of the USA PATRIOT Act, IRS has dramatically 

increased the number and scope of Title 31 examinations of check cashers. Nonetheless, there has not 

been a corresponding increase in BSA violations found within the check cashing industry. 

Efforts by FinCEN and the federal bank regulatory agencies have had little or no success in reversing 

the trend of blanket bank discontinuance. It has become clear that there is a need for federal legislation 

to relieve the regulatory burdens on banks serving the MSB sector. Indeed, over the past 18 months, 

representatives of FiSCA, the American Bankers Association, and other key MSB and banking 

organizations, have been working together to arrive at a solution to bank discontinuance. 

These efforts recently culminated in the proposal of a bill specifically designed to provide regulatory 

relief. The main component of the bill would reduce the regulatory burden on banks by relieving them 

of a duty to act as the “functional regulator” of their MSB customers. This would be achieved by 

implementing a new process whereby an MSB would provide baseline compliance information to its 

bank (i.e., proof of federal MSB registration and state licensure) and would then certify to its bank that 

it maintains an appropriate four-part BSA/AML program under 31 CFR 103.125 – leaving the business 

of MSB compliance regulation to the IRS and state functional regulators. 

X. The Matter of Small Dollar, Short-Term Loans 

In response to an acknowledged enormous consumer demand for small dollar credit, mono-line payday 

advance companies and many FSCs have met this need primarily by offering small dollar, short-term 

loans, commonly known as payday loans. Since the development of this product, approximately 75% 

of the states have passed laws permitting lenders to make payday loans. 

In 2006, 150 million payday loans were made, of which approximately 21%, or 32.4 million, were 

made by FSCs. (Attachment 1). The fastest-growing segment of the industry, Internet and loan-byphone providers, represented nearly 12% of the volume of all loans made. Some experts estimate that 

these mostly unregulated providers have a growth rate of 40%. In fact, these Internet and loan-byphone providers are operating even in states where the product is not locally permitted by law. These 

figures clearly support the growing consumer demand. 

There have been substantive issues raised by consumer advocates about the payday loan product. Are 

they really too costly? Are they a road to financial ruin? Are there areas for reform? Are there 

palatable changes that could still meet the consumer’s needs and remain a viable product to the 

provider? Unfortunately, most of the public and media discourse and debate have been incendiary and 

contentious -- facts are replaced by anecdotes. 
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In order to explore the evolution and development of the small dollar loan product, there needs to be an 

instrument for dialogue among all interested groups. The dialogue cannot occur in the current 

adversarial climate. To begin this dialogue, leadership is required. In the meantime, the need for small 

dollar, short-term loans exists and will continue to expand, and even where the product is not permitted 

under state law, Internet and other illegal and/or unlawful sources will continue to respond to the need. 

The Financial Service Center industry is proposing the creation of a task force composed of regulators, 

industry representatives and consumer groups, to explore the facts and to resolve issues in an 

atmosphere of constructive dialogue. 

XI. Calls to Action: 10 Proposals to the Advisory Committee 

FSCs have been meeting the financial needs of millions of low- and moderate- income consumers with 

the highest degree of customer service and respect for 70 years – forging real relationships with the 

communities and customers they serve. This puts our industry at the very heart of the charter of this 

Advisory Committee, and provides the Committee with an opportunity to influence and utilize an 

already existing, direct conduit to the consumers for whom this Committee was created. 

FSCs are located in the communities where these individuals work and live, they provide products and 

services daily that generate the highest customer satisfaction, and they have the framework, motivation 

and ability to expand access to financial services to meet new, as well as existing demands. Not only 

would the structure, knowledge and network of this industry be helpful to the Advisory Committee in 

reaching its objectives, it is the key to any program that seeks to engage these consumers. 

It is in this spirit of a common goal – to serve low- to moderate-income consumers – that FiSCA puts 

forth the following 10 Calls to Action, in the form of proposed resolutions. Therefore, we ask that the 

Advisory Committee RESOLVE, to recommend: 

1. To include the Financial Service Center Industry, represented by FiSCA, as a 

partner on the Advisory Committee, as a first step toward a productive dialogue 

addressing financial services to low- and moderate-income consumers; 

2. To encourage the use of the Financial Service Center network as a ready-made 

delivery channel to reach low- and moderate-income consumers;

3. To provide banks the direction, incentive and motivation to make banking services 

available to Financial Service Centers; 

4. To actively support the Bank Discontinuance Bill when it is introduced and to 

otherwise work to end bank discontinuance; 

5. To dispel the myths about the compliance burdens and risks posed by MSBs and 

replace them with the facts;
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6. To expand access to credit by endorsing, by all available means, encouraging the 

use by banks of alternative credit scores such as those developed by PRBC;

7. To promote and encourage the expansion of savings programs such as the 

FiSCA/NetSpend National Savings Program, in order to encourage low- and 

moderate- income consumers to take advantage of these savings opportunities;

8. To promote and encourage the expansion of partnerships and alliances between 

banks, credit unions and Financial Service Centers;

9. To promote, encourage and support financial education programs that reflect 

demonstrated needs and preferences and are designed for low- and moderateincome consumers who use Financial Service Centers; and 

10. To form a “Small Loan Task Force” comprised of regulators, consumer 

advocates and providers from within the Financial Service Center industry in 

order to foster constructive dialogue about the best ways to ensure the availability 

of small dollar, short-term loans and other forms of credit, while still ensuring 

that consumers have protections from lending abuses. 

XII. Conclusion 

The proven size and scope of the Financial Service Center industry, which has for more than 70 years 

provided convenient and innovative services to low- and moderate-income consumers, virtually 

mandates that the industry be included in any program to deliver financial services to these consumers. 

One need look no further than the market studies that consistently report high customer satisfaction 

with the products and services available at FSCs. 

The failure to recognize the role and value of FSCs in providing financial services to low- and 

moderate-income consumers is a disservice to these consumers, and to the industry itself, which has 

time and again proven to be a responsible provider of financial services. Until now, the most 

significant barrier to inclusion of FSCs in the “mainstream” financial services industry has been the 

unchecked dissemination of often irresponsible allegations that are not always supported by facts. This 

Advisory Committee can change the course of this dialogue, and play an instrumental role in assisting 

the FDIC in its efforts to provide innovative leadership to the financial services community, by 

embracing the 10 Proposals contained in FiSCA’s Calls to Action submitted herein. In so doing, all 

members of the financial services community, including banks and FSCs, will benefit. Real 

recognition by the FDIC of the contribution of FSCs will give the industry further impetus and 

endorsement as an outlet for the delivery of financial services. That recognition will also benefit the 

low- and moderate-income consumers who utilize those services, which is the true mission of the 

Advisory Committee. The Advisory Committee would be thereby taking the first step in evolving and 

effecting real change, in perception and in fact. 
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Attachments 

1. “Survey of Key FiSCA Member Organizations on Transaction Volumes”, by Patricia J. Cirillo, Ph.D., 

Cypress Research Group, October, 2007 

2. “Survey of Customers of FiSCA Member Organizations”, by Patricia J. Cirillo, Ph.D., Cypress 

Research Group, September, 2006 

3. “Making Dollars and Sense: The State of the Market”, by William McCracken, CEO, Synergistics 

Research Corporation, October 6, 2007