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Numerous companies appear to be seeking a way to return short-term credit to the debit card platform.
Cash America (8-K, April 22, 2011): In the past, the MLOC services channel generated its earnings through loan processing services the Company provided for MetaBank related to the iAdvance MLOC product, as well as from fees generated from participation interests the Company acquired in the receivables originated by MetaBank in connection with the iAdvance program. The iAdvance program ended on October 13, 2010. The Company intends to continue pursuing the development of new MLOC opportunities during 2011.
It would not surprise me if many advocates mistakenly assume that this issue
Glowing third quarter results from EZCorp (EZPW)on Thursday followed similar news from Cash America (CSH) earlier in the day, hinting that the sudden restriction of credit from banks is pushing more consumers to their local pawn shop. First Cash Financial Services (FCFS) had the same story on Wednesday.
EZ Corp reported a net income of $20 million, which was up 39 percent from the same quarter a year ago. US pawn lending drove a lot of that gain. Operating income rose 36 percent in domestic stores. Granted, EZCorp bought 13 new stores, but according to their conference call, most of those new stores were only integrated during the last part of the year. So, as bright as things are for EZCor, it may get even brighter.
A CEO of General Motors once said that "what's good for General Motors is good for America," but that insight would
Cash America (CSH) reported a strong (indeed, a "blow-out!") quarter this morning, and although their stock is down this morning, their success would indicate more activity for payday and pawn lending. Their volume is up, which certainly contrasts with the lamentations about low loan demand that we have heard from the big banks, and they are growing their customer base is expanding.
This is really not a great sign for our economy. It points to the poor alternatives that people face once they move out of the banking system. More people are making that move, unfortunately.
Guess what state leads the nation in the highest average credit awarded to tax filers under the Child Tax Credit? If you guessed Massachusetts, you would be wrong. The child tax credit, it turns out, is a boom for red states in the West, particularly those that are largely rural. The leader, not surprisingly, is Utah. In Utah, the average credit was $342. Lowest? The District of Columbia, at $104. Why the large discrepancy? There are two factors. First, states with higher family sizes have a big advantage. Idaho was second, Wyoming was third, followed by Nebraska and Alaska . As well, it hurts if incomes are generally higher. Northeastern states lagged.