FiSCA Hopes DC Headquarters Allows Access to Lawmakers
In a move of self-preservation, FiSCA (the Financial Services Centers of America) has moved its headquarters from Hackensack, New Jersey to Washington D.C.
Last summer President Barrack Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act as part of a sweeping reform of the nation’s financial system.
The law came as a result of the near collapse of the U.S. economy and the unearthing of the shoddy, selfish and fraudulent financial practices that caused the economic crisis.
Part of the Consumer Protection Act is the creation of a new federal agency, the Bureau of Consumer Financial Protection, designed to oversee a range of financial institutions and products on behalf of consumers. The new agency will be housed in the Federal Reserve.
FiSCA, a trade association that regulates financial services like payday lenders, is now headquartered a mere two blocks from the new Bureau of Consumer Financial Protection.
Payday loans have been under fire in recent years, saddled with terms like “usury” and labeled as “exorbitant” for occasionally carrying high interest rates. Many States have already outlawed payday loans or set a maximum interest rate that lenders can charge. Industry leaders and FiSCA brass fear that out of sight is out of mind, and out of mind could spell the end for payday loans under the authority of the BCFP.
Though to this day cash advance loans have only been regulated at the State level, the scope of the BCFP will be sure to include payday lenders. One of the new agencies’ tasks is to write new laws and set regulations for financial businesses to help protect consumers from abuses.
FiSCA hopes that their strategic move will allow them more access to lawmakers and allow them to lobby and negotiate less stringent regulation.
FiSCA members gross over $100 billion in transactions a year, serving over 30 million customers. With big banks, like Bank of America, still reeling and in the midst of yet another scandal, payday loan lenders hope to leverage their niche as providers of small, accessible loans into taking even a bigger chunk of the loan market from traditional lenders in the years to come.