Monthly Archives: July 2010

The Bank for the Unbanked

The good news is that the unbanked don’t mind paying fees for services. Every transaction they do typically has an associated fee. These fees are not considered usurious or non-completive. The unbanked prefer the fee schedule at a check-cashers or Wal-Mart because the fees are printed up front, in big letters on a sign. Customers know what they are paying, and there are no hidden “gotchya’s.” The common perception that check-cashers and payday loan stores charge way more than a traditional bank for comparable services is not really true. In fact, according to a recent national study by Moebs Services as reported by Payment News, “Consumers who are frequent users of overdraft (OD) fees at banks and credit unions could save money by bridging their cash gap with a 14-day payday advance loan, rather than paying checking account over draft fees.”
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Are the Unbanked on the Internet?

In the last few weeks there have been several announcements of companies offering solutions for consumers to pay cash for Internet purchases. In addition to current solutions by companies like eBillme, GreenDot, Paypal and Amazon, there are now offerings from start-ups like Paynearme, partnering with 7-Eleven, and Vindicia, integrating with Incomm. Altogether, a cash-based customer…
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