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Nov / 22

Accion Venture Lab’s Paul Breloff on FinX

At the end of last year CFSI hosted an in-the-field activity designed to put participants in the shoes of underserved consumers as they attempt to complete several financial transactions. This particular FinX event shared the focus area of the Financial Solutions Lab first innovation challenge which will be launching next month, household cash flow management.

One of the day’s participants, Paul Breloff, Managing Director at the Accion Venture Lab, shared his FinX reflections with his team, and ultimately, CFSI. (Ariel Schwartz, Senior Editor at Co.Exist, also wrote about this experience in her piece “What It’s Like to Live Without A Bank Account For a Day.”) In short, Paul’s comments were powerful and confirmation that FinX is a positive learning experience for participants. He highlighted just a few of the many challenge areas that are ripe for technology solutions. Below are Paul’s notes…

On November 18, 2014 a group of about 25-30 financial service folks (a handful each of bankers, startup executives, investors, tech company reps, journalists, and nonprofit leaders) gathered in the Mission to put ourselves in the shoes of underbanked customers in the U.S. Part scavenger hunt, part ethnography, FinX was a great chance to see the bewildering array of frustrating financial options available to underbanked customers in the US who are short on liquidity, short on time, and short on attention. Here’s the limited description I got before showing up: “This experience is not your traditional workshop or walking tour of a local neighborhood. It’s an actual step into the shoes of consumers making real-time decisions about fees, expediency, time, and convenience. The 2-hour in-the-field challenge is a rare opportunity for executives of financial institutions, FinTech innovators, and nonprofit leaders to go beyond simply hearing about the challenges that consumers face, and experience the real-life constraints and options they have. With your team, you will attempt to complete financial transactions such as cashing a check, acquiring and using a prepaid card, or seeking out a small loan.”

Once we arrived, we were split into about nine teams of three, and were given a packet of materials describing our situation. We were to pretend we were on a two hour break between shifts and had to get done a variety of things before our 12:00 p.m. shift started again. We were to assume we didn’t have a bank account, and had to cash a check, get a money order, pay rent and electricity, load a prepaid card, purchase a gift for our niece, and grab a snack—this was, after all, our hypothetical lunch hour. We also had to figure out the best rate we could get on a $500 loan from anywhere we wanted, and we had to haggle with a pawn shop owner about the value of my watch (we ultimately settled that it was worth $30, which I was quite pleased with).

I was on a team with Ariel Schwartz, Senior Editor at Co.Exist/Fast Company and Ethan Bloch, CEO of a fintech startup called Digit. We got off to what we thought was a fast start, finding a pawn shop and quickly negotiating a $30 value on my watch – which I was pleased with, given the fact that it was 15 years old and not worth much to begin with. We were also in high spirits when we located a shop called Ria (a chain across the U.S.) to cash our check. It seemed like it would be quick and easy and we could get everything done at once with only a $0.99 check cashing fee – our customer service representative, safely hidden behind a plexiglass wall, encouraged us politely that this would only take a couple minutes. But alas, they couldn’t get ahold of the payer of the check to verify by phone, and AML/CFT checks on me got tripped up. (Apparently they couldn’t figure out why I lived in DC but was cashing a check in San Francisco.) We lost 40 minutes hanging around being told it would only be “three more minutes.” We were all a bit (politely) pissed off. So that didn’t work.

Next we went to an Ace Cash Express. We waited in line about twenty-five minutes (precious lunch hour minutes ticking away), but once it was our turn, we were thrilled to learn we could indeed getmost of our tasks done, but at a cost: $6 to get the $90 check cashed, a one-time membership fee with Ace, and other fees to get money onto a prepaid. Unfortunately, we couldn’t pay our rent check because their system “couldn’t find the payee.” They said this “happens all the time” and that we should “come back later.” A not-so-fantastic option if you’re working two shifts a day and still want to eat, sleep, and see your family.

Next we had to send money to a family member, so we had to find a Western Union. Thank god for our smartphones and Google maps. We were able to do it, but again, were shocked by the cost: a flat-fee of $5 to send $30 to our friend in the US, who was going to pick it up later that day. That’s the going flat rate for a domestic remittance under $50: the equivalent of nearly 17 percent! This in an era where most of us can send value via PayPal or SquareCash or Venmo for no or little cost – IF you have a bank account which can be linked for ACH transfers. Unfortunately, our family member was told when she went to pick up the money that “the systems were down” and that she should “try coming back in two hours.” Simply ridiculous; I’m really rooting for these startups to motivate some improvements in pricing and service.

On the hustle back to our 12:00 p.m. shift we had to pick up a gift for our niece. We chose a beautiful yellow hula hoop and Brazil soccer ball from the dollar store, where, thank goodness, they accepted our MasterCard prepaid card. We were running short on time so only had time to grab a coconut water and banana on the trek back to our second shift.

None of this was rigged; these were all real stores, processing real transactions with real checks and GPR prepaid cards, treating us like real customers. And it was a great experience. It made me think quite differently about the tradeoffs between fees, convenience, and dignity. As the clock was ticking, considerations of cost, quite frankly, went out the door as we desperately tried to just get things done and not show up late for our shift. In some ways, perhaps, “done is better than cheap.” Also, it was just amazing to confront the bewildering array of choices. Walking down Mission Street, there are quite literally dozens of check-cashing spots, pawn shops, big signs promising fast cash, each with its own confusing set of matrices outlining prices based on a ton of variables. Who has time for that, who really cares at some point?

Should you pay off your mortgage?

Cash is not returning much more than 1% these days and financial markets are volatile and overvalued, portending lower future returns. Many homeowners wonder if they should use their surplus cash to more aggressive pay down their home mortgage. There are qualitative and quantitative factors to consider and the answer really depends on each person’s unique situation and attitudes.

Reasons you would want to consider paying off your mortgage

You want the sense of freedom obtained from not having a mortgage payment.
You want to pay off their home mortgage prior to retirement to reduce your fixed living expenses.
You think the stock market will have a lower return than your mortgage interest rate over the balance of your mortgage.
You have excess cash sitting in low-yielding money markets or savings accounts. Paying off a mortgage with a 4.5% interest rate, for example, will be a guaranteed higher rate of return than the cash and may even exceed what you could get on your investment portfolio over the next few years.
You are already maximizing your savings to your retirement accounts and have paid off other high-interest debt.
You have a relatively small balance and few remaining years on your mortgage.
You have a hard time saving extra money and adding extra principal payments to your mortgage will be a ‘forced’ savings program.
Your payment and or interest rate are high.
You anticipate a declining income.

Reasons you may not want to accelerate you mortgage payoff.

You have low cash reserves.
You have other loans with high-interest rates than need to be paid off.
You have a low-interest rate are young and plan on living in the home for the foreseeable future. Over time, your inflation-adjusted mortgage payment will seem extremely affordable.
You want to leverage your money. By taking on debt for your home, you can free up money to be invested in the stock market.
You expect stock market returns to exceed the interest rate of your mortgage over the remaining term of your mortgage.
You need to maximize your liquid assets. Don’t be house rich and cash poor. Those with a high home value relative to their other liquid investments don’t want to pour all of their extra funds into the home as they will have minimal liquid assets to live off of. This is particularly an issue during retirement.
Your payment is low and affordable.
You plan on moving to another residence in the next few years.

Taxes are also a consideration. But I don’t normally encourage that clients make major debt decisions based solely on taxes. If you are in a higher tax bracket, the mortgage deduction has more value, but note that there is a good chance that future Congressional action may completely eliminate this deduction or limit it to lower income levels.

Nov / 17

The Overdraft Problem Is Really a Credit Problem

There is growing evidence that consumers who have a need for credit are turning to overdraft because they lack better options. A recent Wall Street Journal investigation of fee income at banks inside retail stores, for example, quoted a customer saying she overdraws “all the time” because the overdraft fee is cheaper than a payday loan.

The fact that some people are forced to choose between overdraft and high-cost payday loans when they experience a shortfall is a clear sign that something is missing in the marketplace. But rather than spending time debating which option is worse for consumers or focusing solely on reining in overdraft, we ought to shift our energies to creating new credit products that meet consumers’ needs transparently and affordably.

Innovating in small-dollar credit is challenging, given the myriad state rules, lack of clear federal guidelines and inherent riskiness of lending to people without a credit history or with damaged credit. Some forward-looking lenders, however, are experimenting with new ways to meet these consumers’ needs, often drawing on technology to minimize risk, reduce the cost of delivery and improve the customer experience.

To support and encourage such experimentation, CFSI recently launched a Small-Dollar Credit Test and Learn Working Group, which convenes five companies that are piloting new credit products or product features that align with many of the quality guidelines in CFSI’s Compass Guide to Small-Dollar Credit. CFSI, with the support of the MetLife Foundation, the Ford Foundation and the Omidyar Network, will partner with working group participants to track their pilots’ outcomes and to share valuable lessons with the rest of the industry. Here’s a snapshot of what the companies are testing:

Regions Bank is piloting changes to its existing savings-secured installment loan that enables customers to borrow with as little as $250 in savings. Since reducing its minimum savings requirement from $2,000 to $250 early this year, Regions has seen demand for the installment loan increase dramatically. Regions aims to better understand what customer need (or needs) this product is meeting and what lessons it has to offer for future high-quality, small-dollar credit product design.

Kinecta Federal Credit Union is piloting a payday consolidation loan that will enable customers to convert multiple outstanding payday loans into a single installment loan. LexisNexis Risk Solutions will partner with Kinecta to provide underwriting data for the loans. Kinecta is testing whether the ability to consolidate multiple payday loans and pay them off over time with affordable monthly payments helps its members to break the cycle of debt.

Emerge Financial Wellness is experimenting with ways to increase take-up and usage of an optional “Save as You Repay” feature, which enables borrowers of its workplace-based installment loan product to contribute additional funds to a savings account each time they make a payment. Emerge aims to identify the most effective ways to help its customers build a cushion against shortfalls, thereby reducing their need for credit in the future.

Enova International is piloting a new feature that enables customers of its online NetCredit Gold product to customize their loan terms and monthly payment amounts. Enova International seeks to gauge whether borrowers will be more successful repaying their loans if they’re able to choose the payment amount that fits their budgets.

We expect that each of these pilots will contribute valuable lessons about what works in small-dollar lending. We hope some will succeed and will be replicated by others in the marketplace.

But innovation also requires the willingness to fail and to learn from that failure. The only way we can understand how to align borrower and lender success in small-dollar lending is by testing and learning, over and over again. We must embrace the philosophy of lean innovation—rapid-testing and customer feedback—if we ever hope to make progress on filling the gap in the market for high-quality small-dollar credit.

Aug / 06

These Sites Can Help You to Check If Your email has been hacked

During this pandemic, working from home is very dependent on using internet technology to do assignments and reports. You may have company email and personal email to send your report or assignment or for other purposes.

Nowadays cyber crime has so much that we must be extra careful to maintain the security of email accounts. Now there are various ways to check whether your email has been hacked or not. There are several sites you can go to to check. But before you check, you can also learn the methods provided by the site where you create an email to secure your account first.

Here are some sites that you can go to to check the security of your email whether it has been hacked or not.

HaveIbeenPwned

This site is one of the most well-known sites to check your email security status. The method is very easy to check. You just enter your email address in the column provided and in a few seconds your email status will come out whether it has been hacked or not.

If your account has been hacked or is insecure, you will be notified where your account was hacked or what sites you have registered and the site has been compromised for security.

Firefox Monitor

The way it works is almost the same as the previous site. You just have to visit the monitor.firefox.com site then enter your email address in the column provided and you will know your email status whether it has been hacked or not.

Avast.com

This site is quite detailed in providing information about your email security status. Via email, avast will notify you of what sites are connected to your email that has been hacked, how many times the email has leaked on social media or e-commerce.

Jun / 14

How to Manage Finance So Credit Card Debt Does Not Pile up

It’s not a big sin to use a credit card to pay for groceries. However, you should be wise to use it so as not to get wrapped up in credit card debt.

It’s legitimate if you use a credit card as a means of payment. Because, you can benefit when dealing with credit cards.

For example, you have the opportunity to get a 30% discount at dinner in certain restaurants. Or, you can get 0% installment facility when buying a smart phone at certain outlets

Budi Raharjo, One Shildt’s Financial Planner said that credit cards can secure your cash flow. Because, you do not need to spend when there are sudden expenses. For example, you can use it to pay for hospital bills.

However, you must remember that credit cards are debt, not additional income. So, you must pay the debt.

So here are 4 ways you have to do so that you will not get into trouble using credit card.

Pay the bill fully

The first step you must do is pay credit card bills fully. The goal, so that you do not have to bear the interest bills in the following month.

If you do not complete the debt payment on time. You will certainly lose money because you have to pay interest on the bill in the next billing month.

Do not use a credit card before the bill is paid off

The second step, you should not use a credit card if the bill has not been paid off.

That way your bills do not continue to swell in the following months.

Pay bills before the due date

The third step, you must pay the credit card bill before the due date. That way you don’t have to pay late fees.

Budi recommends that you pay your bills before the billing date so that you do not incur interest on credit card bills.

“Make sure you have enough money to pay the bills before using a credit card,” Budi said.

Diligently check and recheck the value of using a credit card

The fourth step, you should routinely check the amount of credit card usage.

Then, think about whether you can afford to pay off all bills before the due date.

If you feel the charge is too large, then you should stop dealing with the credit card.

Jun / 03

New Normal In the Workplace, What Will Change?

When returning to your workplace after working from home during quarantine at home, life at your workplace will never be the same again. During this pandemic, we will live the New Normal life until the epidemic ends in total, at least there is already a drug or vaccine for the Sars-Cov-2 virus.

Every country in the world has slowly opened the lockdown but with a health protocol that must still be followed to prevent transmission of the Corona virus. This also applies in the workplace or offices. The following are some types of changes in New Normal Life at work or offices.

Bring Your Own Food

This does not mean you cannot eat in an office canteen or restaurant that is open near your office. But there will be strict protocols, such as social distancing, there is a maximum of people in the canteen or restaurant. This also means you bring your own cutlery because you certainly will not want to share cutlery with other people during this pandemic, right?

To avoid sharing cutlery and those who sneeze in front of you while you eat, bring your own food is the best choice in this New Normal period. You don’t need to share your cutlery with other people and of course you know the cooking process from lunch that you bring yourself from your home. You are also more efficient if you bring your own lunch from home.

Online Meeting

In the New Normal era as a result of this pandemic, holding meetings online will become common and normal. Until the situation is considered safe, even meetings can be conducted via video call even though the workers have entered the office. Online meetings will become a ‘new normal’ that needs to be familiarized with.

More Individuals

Even though the lockdown has been opened, the isolation period may continue on a smaller scale. At least everyone is asked not to gather, go to crowded places on a large scale or share things until the virus has completely died down. In any office, workers will be asked to bring their own cutlery and even write. If you previously could have lunch with your office friend or joke around during breaks, it might be different in this New Normal application. You might still be able to socialize with your colleagues but within a safe distance and it might be more comfortable if you do it online through social media only.

Hand Wash and Hand Sanitizer

If you washed your hands only when you went to the bathroom, now you may do it more often while in the office. You and your colleagues will be more diligent in cleaning your office desk even though there is a cleaning service in your office. Hand sanitizer will also be a mandatory item in your current briefcase. Some countries have even made hand sanitizer machines without touch to make them more hygienic.

The US Government Blacklisted Several Chinese Companies

During this pandemic, several countries gave policies in the economic fields to maintain the stability of the countries in the business and economic fields. One of them is in the field of domestic and foreign trade. The US government also took several policy steps to maintain economic stability in the trade sector. This policy was taken after considering several things to maintain business and economic stability in the country.

One very real policy is the inclusion of several Chinese companies on the blacklist. The company was included with the reasons behind everything. The US Commerce Department’s move marks the Trump administration’s latest effort to crack down on companies whose products can support China’s military activities. At the same time, punishing Beijing for its treatment of the Muslim minority.

The Reason

Reporting from Reuters, the US Department of Commerce noted that Seven companies and 2 institutions were involved in human rights violations and violations carried out in the Chinese suppression campaign, arbitrary mass detention, forced labor, and high-tech surveillance of Uighurs. The blacklisted companies are companies that focus on artificial intelligence (AI) and face recognition, where US companies such as Nvidia Corp and Intel Corp have invested heavily in it.

The List Of The Companies

Among the blacklisted companies, the name NetPosa was called. NetPosa is one of the well-known AI companies in China, whose face recognition is associated with Muslim surveillance. Then there is Qihoo360, a large cybersecurity company that was expelled from Nasdaq in 2015. Qihoo360 recently made headlines because it claimed to have found evidence of a CIA hacking tool used to target China’s aviation sector.

Furthermore, a company called CloudMinds was also blacklisted. The company, which receives financial support from Softbank Group Corp, operates cloud-based services to run robots such as Pepper’s version, a humanoid robot capable of simple communication. In fact, CloudMinds has been blocked since last year for transferring technology or technical information from a US unit to its office in Beijing.

“Xilinx is aware of the recent addition of (the company to the blacklist) of the Department of Commerce. We are evaluating any potential business impact. We comply with the rules and regulations of the new US Department of Commerce,” the company said. “Xilinx is aware of the recent addition of (the company to the blacklist) of the Department of Commerce. We are evaluating any potential business impact.

We comply with the rules and regulations of the new US Department of Commerce,” the company said. For information, the US Department of Commerce’s actions followed a similar action that occurred in October 2019. At that time, the US included 28 Chinese public security bureaus and companies, including several start-up companies AI and video surveillance company Hikvision.

May / 23

Keeping You On A Budget

When you hear the word budget, what do you have in mind? Some people interpret it as a ‘bond’ for their money, some who have lived accustomed to the budget consider it as freedom. Why can there be two different points of view? Of course this speaks of discipline and insight that change someone’s mindset about how they use their money wisely.

In the new normal life after the independent quarantine is opened, you can draw lessons or even use this opportunity to spend your money to just eat dinner at a restaurant and shop for new clothes, because you feel you don’t need to be quarantined anymore. So here are some tips to keeping you on a budget from Rachel Cruz a seasoned communicator and #1 New York Times best-selling author, helping people learn the proper way to handle money and stay out of debt.

1. Budget to zero before the month begins.

This means before the month even starts, you’re making a plan and giving every dollar a name. Zero-based budgeting is a way of budgeting where your income minus your expenses equals zero. With a zero-based budget, you have to make sure your expenses match your income during the month. That way you’re giving every dollar that’s coming in a job to do. Let’s say you earn $3,000 a month. Everything you spend, save, give or invest should to add up to $3,000. That way you know exactly where every one of your hard-earned dollars is going. You could be setting yourself up for disaster if you don’t know where your money is going each month. It’s no fun to look up one day and find out you have no money—and no clue—where it all went!

2. Do the budget together.

If you’re married, sit down once a month and have a family budgeting a night. Grab some of your favorite snacks and put on a good playlist to help you focus. You need to get on the same page with money, so set goals together and dream about what the future will look like. Remember: If the two of you are one, your bank accounts should be one too! It’s no longer your money or my money—it’s our money. And if you’re single, find someone who can act as your accountability partner and help you stick to your goals!

3. Start with the most important categories first.

Because every month you have different expenses, for example this month you have to pay school fee, or like back-to-school supplies or routine car maintenance. Other months you’ll be saving for things like vacations, birthdays and holidays. Regardless of the occasion, make sure you prepare for those expenses in the budget. Don’t let these special occasions sneak up on you. Be sure to adjust your budget each month as things change. Make a savings fund you can stash cash in throughout the year. When you don’t have a plan, you’re going to be stressed. And that takes all the fun out of giving and celebrating. No one wants that!

May / 11

How To Handle Stress During Quarantine At Home

In the midst of the Covid-19 pandemic, social distancing has become a choice that must be made by people around the world to close its spread. The death toll has reached tens of thousands of people worldwide and has infected around 2.8 million according to WHO data as of 27 April 2020.

Determination of staying at home and doing work from home activities, school from home bus can cause stress from home. A review from The Lancet found quarantine was associated with symptoms of post-traumatic stress disorder (PTSD), confusion and anger.

Some studies also show this effect lasts long. PTSD itself is a posttraumatic stress disorder, a psychological disorder that occurs after experiencing an unpleasant event or trauma. Some famous artists such as Lady Gaga, Demi Lovato and Adelle admit that they have experienced such mental disorders. To overcome this mental disorder, a psychologist Sue Firth suggests the following things.

Stay Connected with Others

You can use video calls to family, friends, or your friends. This can make your mind not easily stressed and they share their situation with you. Establish relationships with people close to you can make your mind become more relaxed and even release the tension in your mind. Sharing the facts about COVID-19. Understanding the risk to yourself and people you care about can make an outbreak less stressful.

Doing Light Sports

When you feel bored while you are at home, do light exercise or open the internet looking for easy dance moves that are easy for you to learn. Body movements can be a mood booster where blood flow becomes smooth, you also get good health benefits. Light movements help you also become more relaxed and forget for a moment the burden of thoughts accumulating in your head.

Learn New Skills

African woman working on new building plans while sitting at her desk. Female interior designer working at home office.

There are many online course offers that you can take to get new experiences or new skills. Take this opportunity to develop yourself and heal your trauma or stress. This new skill will help you in the future. Learning something new will give you something positive for you, so you not only forget the stress or things that make you stressed.

May / 07

How To Make You Productive In Social Media

According to the new marketing research, 92% marketer now place high value on social media. If you have social media dan get bored only to view status updating, photos, videos of your family and friends, why don’t you think about to make it more productive.

The result of marketing research above is one of indicator that modern business today use social media platform as a tool to promote, sell, and many other kind of business activity that you can do on social media. So, here are some ways to you can make your social media more productive.

Gain More Followers

To achieve more followers, the general rule is to follow people first ( a portion will follow back). But you must make sure they will continuously follow you and interested every content of your status updating. You can also search some services that offer a number of followers, but choose quality. There are many services like this, but usually people still see this fake account or indeed the original.

Determine What Kind Of Business You Want

There are a lot of business you can do on internet, especially on social media. A mother of two trying to make her motherhood not boring, stressful, etc, had succeed to get thousands followers on Facebook and Instagram when she bravely open her thought and daily activities with funny videos sometimes. Many people affect by the content of social media. Choose what kind of business you want and you will decide the content.

Schedule Your Productive Content

You can inform to your followers that you will publish content about your business you want to start. Openness to your followers will make them feel more closer to you. Invite them with seductive message so they will more interactive to you. They will thinking not just as your ‘customers’ but also as your friend, it will give you double gain.

More Active With Your Followers

The biggest fault in social media marketing is if you think you are number one and only active to your content to post it on your social media by yourself. Be more active to your follower status updating. Care to them. Give comments, give likes, show you are care to them. Make realtionship with them especially to your family and friends. remember that your family and friends circle will bring good moves to your business. They can be your ‘power of mouth’ to your customer in their circle of friends on social media.