CBW (formerly The Citizens Bank of Weir) has been rebuilt to offer high-tech services not available at even the largest banks. Former Google employee Suresh Ramamurthi and his wife, Suchitra Padmanabhan, bought the tiny bank in 2009. Working with a team of software engineers, they have used it as a testing ground for a range of innovative financial services. Most promising is an instant payment system similar to wire payments — but much cheaper. The transfers rely on a custom built back-end that instantly rates the risk of transactions using 20 to 40 factors, including a customer’s... Read more

A new study finds strong revenue growth among payday lenders, auto lenders and other providers of alternative financial services to underserved customers. The financially underserved market revenues increased from $96 billion in 2012 to $103 billion in 2013, based on consumer usage volume of $1.3 trillion in financial products and services. Among the products examined, revenue growth was highest among subprime auto leases, prepaid cards and title loans. The results are a continuation of revenue growth trends in the industry, which has seen an average annual growth rate of 6% since 2009.... Read more

Fannie Mae and Freddie Mac will start making payments that could total hundreds of millions of dollars annually into a fund for affordable housing. Under the new policy announced by Federal Housing Finance Agency Director Melvin L. Watt, the GSEs will set aside a portion of their revenue for the National Affordable Housing Trust Fund. The fund is the only source of U.S. housing money earmarked for the lowest-income families and has been empty since Congress created it in 2008. Watt’s predecessors said the precarious financial condition of the companies prevented them from making payments.... Read more

Two years after the demise of a proposal to speed up U.S. electronic payments, a revised measure now appears likely to be approved by the banking industry. The new proposal was designed to resolve an issue that derailed the 2012 proposal: the fact that banks on the receiving end of transactions will be required to invest in the upgraded ACH network, but won't receive many direct benefits. The revised proposal would require any bank that initiates a same-day payment to pay 8.2 cents per transaction to the bank on the other end, covering the technological investments that banks on the... Read more

In a joint interview, longtime Carver Bancorp CEO Deborah Wright and new president and CEO Michael Pugh discussed the evolution of the bank's role in its communities. "[Michael] is a tremendous talent," Wright said. "We've worked together for a couple of years and, over that time, I became comfortable that he could take the organization to the next level." Pugh intends to expand the bank's customer base with new products. "[T]here is continued opportunity to have feet on the street and grow primary banking relationships," said Pugh. "The next step is a credit solution for... Read more

In a new book, the Federal Reserve Bank of San Francisco and the Urban Institute explore data collection trends in the community development field. The book, What Counts, brings together essays on data collection and use from a wide range of authors, including community development practitioners, regulators and academics. Among the recurring themes in the essays are the promise of the massive troves of data now available to the public — and the challenges of harnessing it safely and usefully. Authors describe a trend toward standardization in the collection of community... Read more

Banks are urging some of their largest customers to take their cash elsewhere or be slapped with fees, citing new regulations that make it onerous for them to hold large deposits in accounts that were previously free. The new measure requires the banks to maintain enough high-quality assets that could be converted into cash during a crisis to cover a projected flight of deposits over 30 days. Because large, uninsured deposits would be expected to leave most quickly, the rule requires that banks maintain reserves that they cannot use for profitable activities like making loans. Some bankers... Read more

Chicago's Urban Partnership Bank is taking on the currency exchanges and payday lenders with new check-cashing and prepaid-card services for individuals who aren't bank customers. The services come at prices well below those of typical currency exchanges -- check cashing will be over 30 percent cheaper. The bank will charge 1.25 percent to cash Social Security checks, paychecks, tax refund payments and the like, compared to 2 percent at many currency exchanges. “We work to give people great value but make a nominal profit while doing so,” said Darryl Hendricks, the bank's... Read more

The U.S. Treasury Department has announced that Annie Donovan will become the new CDFI Fund director, filling the position vacated by Donna Gambrell at the end of last year. Donovan is an experienced CDFI practitioner who most recently served as CEO of CoopMetrics, a firm that provides business intelligence tools to small businesses and nonprofits. Previously, Donovan was a senior policy advisor at the White House, working to advance impact investing with the Office of Social Innovation and the Council on Environmental Quality. Donovan has also served as the chief operating officer of... Read more