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Few would argue that the time is ripe for financial education in America. Financial products and services are growing in diversity and complexity, the retirement paradigm is shifting, and far too many individuals and families are struggling to make ends meet, often turning to "payday" loans and other high-cost funding alternatives. Low- to moderate-income populations are feeling the worst sting, but financial literacy is an issue among all income levels and age groups. And so, financial institutions, nonprofits, government agencies, corporations, and other concerned entities have taken on the responsibility of creating and implementing financial education programs. This issue of Community Reinvestment Forum examines the success of financial education programs and the Federal Reserve Bank of Cleveland's role in promoting financial education efforts in the 4th District. The article, "Financial Education and CRA: How Examiners Make the Connection" (Paul E. Kaboth), observes that, while nearly every community has public schools and adult education programs that provide opportunities for building computer and other technical skills, few offer financial education programs targeted toward building critical financial savvy related to budgeting, saving, and the cost of credit. Many bankers, however, are eager to offer financial or technical support to programs such as these. The efforts of banks in providing financial education often create a win-win situation: Consumers who most need to build financial knowledge are the same individuals who can become long-term, profitable bank customers. Banks also win when the resources they invest in financial education are recognized by their supervisory agencies as being instrumental in community development. The article, "Dollar Wi$e: Building Financial Literacy City by City" presents Akron, Ohio Mayor Donald L. Plusquellic's views on financial education, noting that under the National Dollar Wise Campaign, mayors organize and implement financial literacy programs in their communities using materials provided by the Council for the New American City, a coalition of nonprofit groups, corporations and businesses that share a common goal of increasing investment in American cities.

Asset development is an emerging approach to promoting self-sufficiency for low-income workers. By promoting and rewarding savings, asset development strategies encourage individuals to set long-term economic goals. Asset development strategies can accomplish the following objectives: (1) give low-income workers the knowledge required to navigate issues related to asset building; (2) accumulate assets without disqualification from participating in income benefit programs; and (3) access savings mechanisms for which they are eligible (for example, housing-based accounts available to residents of public housing). A variety of resources regarding asset accumulation for low-income workers are available in print or on the World Wide Web. The following programs are among noteworthy asset accumulation programs: (1) the federal Assets for Independence Demonstration Program, which encourages low-income individuals to accumulate assets by matching individuals' savings with federal and private funds; (2) California's Worker Income Security Project, which offers individual development accounts and financial literacy training to low-income workers; (3) Massachusetts' Full Employment Program, which allows welfare-to-work clients to build savings by depositing $1 for every hour worked in their first year of employment; and (4) Oregon's program requiring employers to deposit $1 for every hour worked by their employees who are welfare-to-work clients. (Contains a list of 13 publications, electronic resources, and resource contacts.) (MN)

This document consists of ten consecutive issues of the serial "Rural Trends and Conditions," extending from Spring 1995 through February 1999. Issues contain information and statistical data on rural economic and social conditions. Beginning with the Fall 1995 issue, issues exhibit repeating themes such as "Financial Institutions", "Rural Industry", "Federal Programs", "Socioeconomic Conditions." While the conditions and trends described in this serial will be of general interest to rural educators, there is little material directly related to education. The "Federal Programs" issues (v7 n2 and v8 n1) usually have a single chapter on "Education and Training." The financial issues usually contain some data pertaining to earnings and educational level of hired farm labor. The socioeconomic issues for this period contain population and migration data showing that the rural "brain drain" that involved loss of college-educated people from rural areas during the 1980s is no longer evident in the late 1990s. (EF)

The five volumes of Rural Conditions and Trends for 1990-1994 contain information and statistical data on economic and social conditions and trends of interest to rural educators and researchers. Articles cover the following areas: macroeconomic trends; employment; unemployment; industry; earnings; income; poverty; population; national economic conditions; national economy links to rural areas; county classifications; the rural workforce; and farm income. A supplement to the Spring 1991 issue discusses financial institutions; rural banks; rural savings and loans; credit unions; rural credit markets; deposit insurance reform; and projected trends. Volume 3 number 1 discusses the loss of better educated people to urban areas. Wider opportunities for jobs requiring higher skills and paying higher wages in metro areas undoubtedly has contributed to the loss of college-educated nonmetro people to metro areas. If rural areas do not find ways to create or attract high-skill, high-wage jobs, then there may be little that can be done to close the earnings, income, and poverty gaps and keep more highly educated residents in rural areas. Volume 4 number 3, the special census issue, compares economic and social changes during the 1980s to those of the 1970s. Educational attainment and earnings of hired farmworkers is also covered. Issues contain extensive data tables, statistical figures, and appendices providing data sources and definitions. (SV)

This newsletter presents four articles designed to help business educators educate learners in grades K-12 about personal finance. "Now More Than Ever: The Need for Financial Literacy" examines the following topics: evidence that the United States is becoming a nation of debtors; the plummeting personal savings rate; the increasing complexity of economic decision making; strategies for addressing gaps in education; and steps business teachers can take now. "Teaching Fiscal Fitness" highlights effective strategies for incorporating personal finance into classroom activities, recommends useful educational resources, and discusses the importance of instruction in the following topics: budgeting, credit, comparison shopping, taxes, saving and investing, and the importance of diversification. "Women and Money" explains why financial literacy is especially important for women. "Twelve Principles That Every Young Person Should Know" lists and discusses the following principles of personal finance: (1) map your financial future; (2) don't expect something for nothing; (3) high returns equal high risk; (4) know your take-home pay; (5) compare interest rates;(6) pay yourself first; (7) money doubles by the "rule of 72"; (8) your credit past is your credit future; (9) start saving young; (10) stay insured; (11) budget your money; and (12) don't borrow what you can't repay. A list of 15 resources is included. (MN)

As college costs continue to soar, families across America are confronting a financial burden they find difficult if not impossible to manage alone. Existing programs like student loans are unable to address a problem of this scope. The search for a method to encourage savings for college without drawing on limited public resources has led to a new investment idea: prepayment of tuition. Although difficult to implement, prepayment plans have the potential to totally restructure higher education finance. The principal advantages of state, national, and commercial savings plans are reviewed, then compared with state and national prepayment plans. Helping families save for higher education is a crucial issue facing policy makers and higher education officials. If parents can be encouraged to create "new" savings for future college expenses, higher education will benefit while the nation's perilously low savings rate will be transfused. National and commercial savings plans offer alternatives, although somewhat unsatisfactorily. A well-structured national prepayment plan is essential in order to bring the nation's college tuition crisis in check. Contains four references. (SM)

Policy standards and actions that U.S. colleges and universities can follow concerning South Africa-related investment are discussed, based on a survey of 175 colleges. Investment policy standards include: not investing in companies unless they provide information to shareholders about their business activities in South Africa, not investing in companies unless they sign the Sullivan Principles or an equivalent policy, determining whether companies have implemented and adhered to the Sullivan principles, identifying companies making strategic sales to South Africa (i.e., military or police), refusing to hold investments in banks that make loans to the South African government, prohibiting holding investments in companies that have any operations in South Africa (total divestment), making distinctions about the kind of operations a company undertakes in South Africa, and adopting a deadline for total divestment. Policy actions that can be taken when policy standards have not been met are: contacting the company before divesting, supporting or introducing shareholder resolutions, developing strategies for divestment, managing portfolio impacts of divestment, boycotting goods and services from South African-related companies, managing public relations, and supporting initiatives to help South African students and schools. (SW)

The article discusses the ongoing dispute between the Merchants Payments Coalition and the American Bankers Association regarding the Federal Reserve's proposed reduction in debit card interchange fees. The Fed's proposal aims to lower the base interchange fee that card issuers can charge merchants, potentially impacting revenue for banks and reducing costs for merchants. The slow implementation of the rule changes has been met with criticism from large banks, while merchant groups support the proposed fee cap reduction. The ABA has raised concerns about the impact on affordable banking services, while the MPC argues that blocking the rule would maintain high fees charged through card networks. [Extracted from the article]

Affirm is addressing an issue with some debit card customers experiencing transaction declines, as stated by the company's CFO during a recent presentation. The company is focused on reducing card declines and improving user experience, with roughly 1.4 million debit card users. Affirm is working on consumer education and has a dedicated team to address declines, although specific details about the issue were not provided. [Extracted from the article]

Fiserv, a financial technology company, is set to acquire Payfare, a Canadian digital banking firm that specializes in earned wage access services. Fiserv outbid Payfare for a contract with delivery company DoorDash, leading to the pending acquisition. The deal, estimated to be worth $140 million, aims to enhance Fiserv's embedded banking, lending, and card management services. Payfare's CEO expressed optimism about the acquisition, citing improved scale and technology to serve a larger clientele. [Extracted from the article]

The Consumer Financial Protection Bureau has filed a lawsuit against Early Warning Services and three banks over fraud on the Zelle payments service, alleging that customers have lost $870 million over seven years. The CFPB criticized Zelle's rushed launch to compete with digital payment rivals, leading to inadequate safeguards against fraud. While EWS and the banks dispute the allegations, consumer advocates view the lawsuit as a crucial step in holding Zelle's operators accountable for failing to address fraud complaints adequately. [Extracted from the article]

Visa reported a significant increase in suspected fraudulent transactions during the Thanksgiving holiday shopping weekend, with a threefold rise compared to the previous year. The surge in global fraud was attributed to criminals utilizing artificial intelligence technology for their schemes. Visa has invested heavily in anti-fraud technology, blocking a substantial number of fraudulent transactions and employing AI and machine learning to combat scammers. Additionally, Visa has been sharing its cybersecurity expertise with other companies and recently made acquisitions to bolster its efforts against online fraudsters. [Extracted from the article]

The Consumer Financial Protection Bureau issued a warning to companies that issue store and airline credit cards, cautioning them against devaluing or failing to deliver on promised rewards for cardholders. The agency aims to protect consumers from bait-and-switch tactics and promote competition in credit card markets. Additionally, the CFPB has created a new tool for consumers to compare card offerings, interest rates, and benefits, based on data from 150 companies. Retail cards, mainly issued by four large banks, were highlighted for having higher interest rates, with 90% of them having APRs above 30%. [Extracted from the article]

BVNK, a London-based stablecoin payments company, has secured $50 million in funding for its U.S. expansion, with investors including Haun Ventures and Coinbase Ventures. The company plans to open offices in San Francisco and New York City to bolster its presence in the American market. BVNK aims to bridge the gap between fiat and stablecoin ecosystems, with CEO Jesse Hemson-Struthers highlighting the potential of stablecoins to revolutionize global payments. [Extracted from the article]

Stablecoins, a type of cryptocurrency tied to traditional fiat currencies like the dollar, have been introduced as a less volatile alternative in 2024. While they have the potential to make payments faster and cheaper, the payments industry has been hesitant to adopt them due to lack of regulation and merchant acceptance. Despite uncertainties, stablecoins could play a significant role in the future of the crypto industry, especially if a clear regulatory framework is established. Additionally, stablecoins have the potential to provide financial access to unbanked and underbanked communities, offering a simpler and more affordable alternative to traditional banking services. [Extracted from the article]

The article discusses the trends in the payment industry for 2025, as highlighted by Jane Larimer, the CEO of Nacha. Larimer emphasizes the increasing use of same-day ACH payments, the importance of defining and educating consumers about pay-by-bank, and the potential role of artificial intelligence in aiding compliance with Nacha operating rules. Additionally, the article touches on the complexities of advancing payments in the U.S. compared to other countries, the gradual shift away from checks, and the ongoing challenge of combating fraud in electronic payments. [Extracted from the article]

American Express is focusing its marketing efforts on younger consumers, specifically targeting Gen Z and millennials in 2025. CEO Stephen Squeri believes that investing in younger customers will pay off in the long run, as they have the potential to become lifelong clients. The company's strategy of allocating more marketing budget towards younger consumers has resulted in increased spending by Gen Z and millennials on Amex cards, showing promising growth compared to older generations. Squeri also emphasized the importance of stability in spending and regulation for the company's future success. [Extracted from the article]

Visa has enforced a credit card surcharge cap of 3%, down from the previous 4%, leading to increased clarity among payments processors and independent sales organizations. Merchants are adapting to cover rising interchange fees imposed by Visa, with some facing fines for non-compliance. While some believe Visa is being aggressive in enforcing surcharge rules, others argue that the fines may not be sufficient to deter non-compliant behavior. Additionally, customer experience plays a significant role in merchants' decisions regarding surcharging practices, with some opting to increase prices instead of imposing surcharges. [Extracted from the article]

U.S. Bank CEO Andy Cecere discussed the decision to split the bank's payments business into two segments, emphasizing the strategic approach to future opportunities. The merchant and institutional payments segment will be led by Mark Runkel, while the consumer and small-business segment will require external leadership. Cecere also expressed optimism about the incoming Trump administration's Department of Government Efficiency and its potential impact on the bank's relationship with the federal government. The bank's annual report highlighted its significant role as the largest provider of commercial card payments to the U.S. government through the GSA SmartPay program. [Extracted from the article]

Plus, tips for your holiday job hunt, a look at milllion-dollar tutors and Silicon Valley's foray into keeping manufacturing jobs in the U.S. in today's Careers newsletter. [ABSTRACT FROM AUTHOR]

A former TD Bank employee in Florida, Leonardo Ayala, has been charged with conspiracy to commit money laundering for allegedly issuing dozens of debit cards linked to shell companies and receiving bribes. The accounts were used to launder millions of dollars in narcotics proceeds through cash withdrawals in Colombia. This case is part of a broader investigation into TD Bank's anti-money laundering safeguards, which resulted in the bank paying over $3 billion in penalties. The scandal has had significant consequences for TD, including executive turnover and restrictions on its U.S. retail business. [Extracted from the article]

PayPal is set to raise its fees for merchants offering its buy now, pay later service, increasing the rate to 4.99% of the transaction plus 49 cents from 3.49% plus 49 cents starting January 13. This move aligns with PayPal's strategy to demonstrate the value proposition for merchants. The company justifies the price increase by citing added features to its services in recent years, as it focuses on profitable growth under CEO Alex Chriss. Other buy now, pay later providers like Klarna, Affirm, and Afterpay have also become significant players in the payments industry. [Extracted from the article]

The global payments industry is undergoing significant digitization, with a focus on real-time transfers, international payments, and the emergence of fintechs. Financial institutions are facing a compliance deadline to adopt the new ISO 20022 messaging standard for cross-border payments, which aims to improve data quality and support rapid processing. However, many banks, especially in the U.S., are lagging behind in implementing this standard, risking potential disruptions in payment processes and missing out on innovation opportunities. Leaders in the industry are grappling with challenges in modernization and skill gaps as they work to meet the new standard and keep up with advancements in digital finance. [Extracted from the article]

Bank of America's corporate clients have processed over $1 trillion in payments through the company's mobile treasury management app, marking a 25% increase in approved payments from the previous year. The app, launched in 2018, has seen steady growth, with 40,000 companies globally and 550,000 users utilizing it for payments, loans, deposits, and trade finance transactions. The app's security features, new capabilities like chat and analytics tools, and the bank's investment in technology initiatives have contributed to its success in helping clients manage their business efficiently. [Extracted from the article]

Block's digital payments company plans to use its Afterpay buy now, pay later feature to attract more users to sign up for its Cash App debit card, targeting unbanked and underbanked individuals. The Cash App card serves as a gateway to offer additional Block products like short-term loans or direct deposit. With 57 million active users, Block aims to increase awareness of services like direct deposit through marketing campaigns. Despite federal investigations into money laundering allegations, analysts are optimistic about the potential growth of Cash App with the addition of Afterpay. [Extracted from the article]

The Consumer Financial Protection Bureau has filed a lawsuit against Comerica Bank for allegedly mistreating 3.4 million cardholders who receive federal benefits through prepaid debit cards. The bank is accused of intentionally dropping customer service calls, charging ATM fees to cardholders entitled to free withdrawals, mishandling fraud complaints, and failing to address fraud complaints in a timely manner. Comerica's contract with the Treasury Department for the Direct Express program has been terminated, with BNY taking over the program in January. Comerica has defended its actions, stating that it operated with oversight and approval from the federal government. [Extracted from the article]

A recent survey by J.D. Power revealed that struggling businesses are heavily reliant on credit cards, with financially unhealthy businesses being twice as likely to carry revolving debt compared to financially stable businesses. The survey, conducted between July and September, included responses from over 3,000 U.S. businesses with annual revenue between $10,000 and $10 million. Despite concerns raised by John Cabell, managing director of payments intelligence at J.D. Power, small business owners still find credit cards useful, with many depending on benefits like priority boarding and free shipping. Additionally, a significant portion of small businesses are using buy now, pay later plans for business expenses, indicating a shift in payment methods beyond traditional consumer use. [Extracted from the article]

The article discusses the importance of maintaining cash as a critical component of the payment system, especially in the face of natural disasters and armed conflicts that can disrupt electronic payments. The author, Jay Zagorsky, argues that a hybrid system that includes cash offers societal benefits and resilience in emergencies. He emphasizes the need for individuals to use cash occasionally to ensure the stability of the economy. Zagorsky also raises concerns about the influence of the credit card industry in promoting electronic payments over cash. [Extracted from the article]

Fidelity National Information Services (FIS) is on the verge of finalizing an acquisition in the capital markets sector, as disclosed by the company's CFO, James Kehoe. The capital markets division, which offers services to asset managers, brokerage firms, and insurers, is set to undergo significant growth with this imminent acquisition. FIS is also focusing on reducing costs through restructuring and outsourcing, while simultaneously investing in digital products and payment services to drive revenue growth. [Extracted from the article]

The Clearing House is increasing the individual transaction limit for payments on its RTP network to $10 million starting February 9, 2025. This change is expected to facilitate larger real estate, supply chain, and business-to-business transactions. The RTP network, operational for seven years, processed $500 billion in instant payments last month and is aiming to attract more corporate use. Additionally, the Federal Reserve's FedNow system is also expanding, with both networks seeking to increase their user base and transaction volumes. [Extracted from the article]

Crypto companies are threatening to retaliate against law firms hiring lawyers from the outgoing Biden administration who were involved in enforcing regulations on the industry. The CEOs of Coinbase and Ripple have publicly criticized lawyers leaving the Securities and Exchange Commission and other federal agencies that worked on lawsuits against their industry. The companies argue that the SEC's enforcement-first approach without clear regulatory guidelines has hindered their ability to operate within the law, and they hope the incoming Trump administration will be more receptive to their call for new rules. [Extracted from the article]