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Payday Loan Industry Newsletter, Issue 05-10Every payday loan operator and chsck casher is concerned with collections. It is always a topic at FISCA and CFSA Conventions. In this issue we discuss SCAN: A new collection solution. We followup with a discussion of the 60 Minutes Payday Loan piece they ran. ****************************************************************Read a few of our previous Newsletters here if you missed them. The focus of our last Newsletter
was : SCAN & A New Payday Loan Collection Solution Beneath the popular myth about a cashless society, checks remain the dominant means of non-cash payment. Industry statistics show 200 million Americans have checking accounts and around 84% use checks as their primary method of payment, writing over 69 billion checks a year. In the middle of this boom the Payday Loan industry was born. But there is a dark side. Ugly but true. You all know the story: Sure, you may subscribe to one of the negative data base reporting services like Teletrack. If every payday loan operator in every locale accurately used these data bases you certainly have a chance of collecting your bad check funds; eventually. But typically, you're left holding a rubber check. The loan was not big enough to justify hiring a private detective an attorney or engaging the services of an outside collection agency. So, you simply stick the bad check in your dead file and move on. In the mean time, this former customer walks away with your money and does the same thing to someone else. Accurate payday advance and check cashing bad check losses are difficult to gather statistics on. Successful operators tend to exagerate their losses to disuade new competition and less successful operators generally discount their losses out of embarassment. Our findings reveal average operators are losing between 4% and 8% of their hard earned money to bad check writers. These ugly statistics are why a new collections expert is making available to Payday Loan stores and check cashers a BIG muscled, negative check database called: SHARED CHECK AUTHORIZATION NETWORK or SCAN. You may have never heard of SCAN but you've seen it in action.If you've ever gone into a Wal-Mart, Target, Costco, Sears, Macys, Smiths Supermarket, Brooks Brothers, Bloomingdales, etc. and bought something with a check you've had an encounter with SCAN. You know the drill. The cashier takes your check and asks to see your drivers' license. She writes your number on the check, then the check is sucked up into the point of sale computer and is then spit out. The whole process takes about 8 seconds! In 8 a-m-a-z-i-n-g seconds your check was flashed to SCAN. SCAN searched its King Kong sized database to see if you were in there. Of course you were not, but if you had been in there the cashier would have handed your check back to you and refused to accept it. An example of what SCAN can do for your company: "Now I pursued civil actions on some accounts but I put all the accounts into SCAN. I got calls from old customers all over the country. The questions were always the same: "After I pay you? How long will it take for you to get me out of your system?" "For 2 ½ Years I Maintained a Bad Check Collection Rate of OVER 70%." If you use SCAN will you get those kind of numbers? I can't promise you that you will. But I can promise you that your collection numbers will increase. Almost 4 years have passed since I worked for that loan company. I did some checking with SCAN and discovered that not a single Payday Loan company is using it's service today, to collect bad checks." FOR $1.34 A DAY YOU CAN GET SOME OF THOSE WRITE OFFS BACK. Over 398 retail chains in 71,000 locations rely on the SCAN database everyday, 7 out of every 10 checks authorized in the United States are processed through SCAN. SCAN gives you the power to control the bad check writer's ability to write checks. Of course I can hear some of you say, "Well I'm already using a bad check database called T----K". T----K is a good database. I have used it from time to time to help me enforce judgments. But T----K is a Subprime consumer database. It monitors high risk consumers who live on the other side of the tracks. But when these consumers stop using furniture rental stores, high risk credit cards, and C & D Mortgage loans, they tend to slip off of T----K's radar. "For $19.95 a month and a 20 cent transaction charge I can give you access to a system that processes 3.5 billion checks a year." WHAT CONSUMER AFFAIRS SAYS ABOUT SCAN:Consumer Affairs: SCAN WILL GIVE YOU THE MUSCLE TO REACH BAD CHECK WRITERS WHERE THEY LIVE, WHERE THEY SHOP, AND WHERE THEY EAT. -
For $19.95 a month and a 20 cent per check transaction fee you can submit your checks to me and I will enter them into the SCAN database. When the debtor calls I can collect the payment or refer him to you. After the payment is received it will be my responsibility to delete the debtor from SCAN. MULTIPLE STORE OWNERS CONTACT US FOR SPECIAL RATES IRONCLAD GUARANTEE IN WRITING COMPLIANCE & TRAINING: OUR NEWSLETTER SPONSOR FOR THIS MONTH: 60 MINUTES PAYDAY LOAN STORY 60 Minutes ran a payday loan piece last week. It was a typical attack on our industry describing us as "loan sharks" preying upon the poor, misinformed consumer. They chose to highlight the supposed uninformed, black, female consumer having no choice but to use our payday advance product to solve her long-term financial hardship. Same old horse, right? We have heard it a million times before! However, when are we going to become active and highlight our strengths? When are we going to proactively fight this kind of bad PR? Granted the media prefers negative stories about an industry. That is how they sell advertising. We will never garner positive media coverage on the likes of 60 Minutes, The New York Times, The Los Angeles Times, or any others. But we do have our stores, our customers, our employees, our families and the families of our customers and employees. As 60 Minutes correspondent Scott Pelly reported, payday stores are among the fastest growing financial services in America -- now a $40 billion-a-year industry. His estimate may be high but the point is we are a HUGE industry. Why? Because the consumers of the world need our product. After evaluating all their choices in the market place they choose us! We must promote this fact. Every industry has it's share of disgruntled consumers and operators lacking scruples. FISCA and CFSA have both sponsored independent surveys revealing the high consumer satisfaction with our products and services. After reviewing these surveys, the research companies that conducted the surveys, having nothing but preconceived notions regarding our product, commented on how pleasantly surprised they were at the results. Our payday loan industry ranks higher in consumer satisfaction than banks, credit card companies, and more! We must take every opportunity to make this point to our regulators, the media, AND OURSELVES! Yes, we know who we are. Those of us who stutter when we are asked what we do for a living. Those of us who hang our heads a little when describing our businesses. We meet some of you at the CFSA & FISCA conventions and in the field. STOP IT! WE SOLVE FINANCIAL PROBLEMS! And we solve these financial problems for millions of consumers every year. Additionally we employ hundreds of thousands if not millions of people in our businesses. So, aggressively solicit testimonials from your clients. Use them in your advertising efforts. Adopt and adhere to the "Best Practices" promoted by CFSA & FISCA. Find out who your state/province representative and regulator is. Contact them. Email them. Talk to them. Stay informed! It will mean money in your pocket and happiness in your head. ******************************************************************Until Next Time, from The Payday Loan Guys This information is discussed further in depth in our Payday Loan Startup & Training Manual. You may ORDER it NOW. Next Month a new topic and coverage of more states. From: Trihouse Enterprises, Inc. If you have comments, questions, topics you would like covered...PLEASE contact: |