FINANCIAL SERVICE CENTERS OF NEW YORK (FSCNY) REMINDS NYS BANKING DEPARTMENT:
April 1, 2009Suggests That Name Change to "Department of Banking and Financial Services" Better Reflect the Reality That New Yorkers Access Financial Services from Multiple Outlets, Including Licensed Financial Services Centers
NEW YORK, NY, April 2, 2009 -- Jason Carballo, President of Financial Service Centers of New York (FSCNY), testified before the New York State Banking Department today and urged the Superintendent of Banks to re-examine traditional notions of how financial services are delivered to low- and moderate-income New Yorkers. While banks have traditionally been considered the point of access to the financial system for consumers, millions of New Yorkers use licensed check cashers to conduct their daily financial business.
Through the years, licensed check cashers have evolved into neighborhood financial service centers (FSCs), offering diverse financial services including check cashing, money remittances, electronic bill payment and stored value cards, which operate as “virtual bank accounts.” Carballo also noted that recent innovations in the field of consumer financial services originated with the financial service center industry, not the banking industry. For example, the Netspend National Savings Program, pioneered with FSCNY, allows consumers to transfer funds stored on debit cards into a no-fee, FDIC-insured savings account,
Carballo’s testimony came during the Banking Department’s hearing to solicit input on the state of the Banking Development District (BDD) program. The Banking Department called on interested parties to answer a series of questions, including whether BDDs are meeting the financial needs of the underbanked and unbanked residents in the Districts, and to make suggestions on ways to better meet the needs of the unbanked and underbanked. Carballo’s testimony also called for traditional institutions to expand the existing relationship that already exists between FSCs and credit unions through the PayNet program. Under this initiative, customers can make deposits and withdrawals from their credit union accounts at participating check cashing locations. Given the greater number of stores and expanded hours of operation, this partnership provides real benefits to these customers. There are currently eight credit unions partnering with area FSCs.
Licensed check cashers have been providing basic financial services to millions of low- and moderate-income New Yorkers for more than 50 years. In fact, the FSC industry is an integral component in the overall solution to providing better services for tens of thousands of New Yorkers as the move up, or down, the economic ladder.
Carballo also suggested that the Banking Department changes its name to reflect the modern world of financial services. “In recognizing the evolution of financial services, and the different institutions that can offer those services, I would respectfully urge the department to consider a name change – from the New York State Banking Department to the New York State Department of Banking and Financial Services, said Mr. Carballo during his testimony. “Names and titles are important. And such a change would send a clear message – to the markets, public officials, regulators, the media and anyone else interested in the industry - that banks are a part of the solution, they are not the entirety of it.”
About FSCNY
The Financial Service Centers of New York is the licensed check cashing industry’s leading voice on legislative, regulatory and business issues and the leading advocate for the rights of consumers to access basic financial services in New York. FSCNY represents about 660 licensed check cashing locations, which employ nearly 4,000 New York residents. FSCNY members annually cash more than 36 million checks with a face value in excess of $14.5 billion. New York has the second-lowest check cashing fee in the nation at 1.82%.
