Navigating Global and Personal Financial Crises with FinTech

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You are listening to Leaders in Lending
from Upstart, a podcast dedicated to helping

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consumer lenders grow their programs and improve
their product offerings. Each week, here,

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decision makers in the finance industry offer
insights into the future of the lending

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industry, best practices around digital transformation, and more. Let's get into the

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show. Hi, this is Lynd
sutter Bille of Upstart, and welcome to

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Leaders and Lending. I'll be joined
today by Penny Lee, who is the

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President and CEO of the Financial Technology
Association, a Washington, DC based trade

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association representing fintech industry leaders. The
FTA educates, informs, and engages with

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Washington, advocating for modernized policies and
regulations that spur innovation and drive inclusion.

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Let's get started, Hi, Penny, thanks for joining me today on Leaders

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Lending. Thanks for having me,
Lynne is a great honor and pleasure to

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be here. Great well. Your
website says that the FTA educates, informs,

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and engages with Washington, and you're
advocating for modernized policies regulations that spur

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innovation drive inclusion. Can you expand
on that. We're kind of in your

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words, describe the mission of the
organization. Sure, yet it's a little

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bit taking out the word salad,
as they would say. And so what

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we do is we represent the fintech
industry and kind of a wide aperture of

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how we define it, primarily as
digitally native financial services companies, and so

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those are things that people use on
an everyday basis, whether or not to

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have their DoorDash delivered and paid for. But a buy now, pay later

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product, a P two P venmo
a cash app, all those kind of

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horizon. And what we do is
we sit in the nexus of Washington and

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try to translate business to Washington and
Washington to business and try to work with

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the regulators, legislators and others to
craft and think through how to put the

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US kind of in the forward looking
phase of what is the future of finance,

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meaning what are the regulations that we
need to put in place that modernize

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to fit the products and services that
are now in the marketplace. What is

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the type of legislation we need to
look at, or what are the types

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of things we need to adopt again
to make sure that the US remains competitive

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not only in the products and services
that they offer consumers and small businesses,

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but also in a global sense.
We're now in a global world economy and

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in a global competitive landscape, so
we want to make sure that our consumers

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when they're traveling overseas, has accessed
that our rules and regulations allow for this

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free flow of money, but also
to use the ingenuity that is occurring kind

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of on a global scale to be
able to have that adopted here in the

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United States. Yeah, that's interesting. So I know there's a few different

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kind of fintech or financial industry associations
growing up, and I do think they

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really have to focus on different areas
and what in your mind, really differentiates

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than the FTA from some of the
other organizations I would see. You know,

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it was started kind of to try
to address kind of the larger fintech

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industry, and so we made as
I said, we made the definition of

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it broad but yet narrow in the
sense of trying to capture all that is

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encompassing of you know, financial technology
or those products and services that are in

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that space. And so we don't
focus on where some might have a more

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niche where they're representing just those that
are in the lending space or just those

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that are in the data aggregation space, or just those that are in just

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a little bit more of a niche
area. So we try to represent those

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that are in lending, those are
in payments, those that are in the

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capital market space, those that are
in binanal pipulator or earned wage access or

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other you know, kind of what
makes this ecosystem of fintech. So trying

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to represent the broader industry. Okay, now that was certainly helpful. So,

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and I think you personally have a
really interesting career background, kind of

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a combination of politics, policy,
angel investing. Tell us about that.

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You know, what your career path
looked like, what different areas have you

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worked in, and kind of how
you ended up rather leading the FTA.

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So it started first love was in
campaigns. I volunteered for my first campaign

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when I was fourteen years old,
and that was the path I was going

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to go study political science and journalism
in college. And then immediately after college

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got connected with the campaign in Texas
and then just that spurred kind of that

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work that I did there for many
years was with Democratic Party and worked on

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a couple was the privilege of working
on a couple of presidentials, and then

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was with a governor in Pennsylvania,
Governor Rendell, and then from there was

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recruited out to run the Democratic Governors
Association, and then that le me into

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working with then majority leader in the
Senate, Harry Reid, and it was

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during that time was hired in seven
and during that time we obviously faced a

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financial crisis in eight and it was
an incredible moment in time to be part

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of that conversation, but also a
very heady days, very scary days,

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very defining moments that we had periodically
throughout that But what we did see was

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it was a time where, you
know, there was always this kind of

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disdain to have to engage in Washington
and kind of a they don't really understand

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what we're doing anyway, so a
kind of an avoidance of Washington. And

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what Owait really proved across all different
sectors was you neque to spend time in

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Washington because there might be a time
on one they need to bail you out,

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or two that you have to make
sure that they understand what your products

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do and don't do. And so
when I left the Hill, that was

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something that I carried out with me
was again trying to not be scared of

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Washington, but also the lessons that
you learn in those companies that had taken

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the time to educate along the way
that it wasn't only in a crisis that

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they were coming to Washington, that
it wasn't only in a negative light,

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but had systematically and periodically showed up
time and time again. So we had

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a good understanding. You know,
that really illustrated one night early in the

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days of the financial crisis. I
never forget that first time we really had

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Secretary Paulson and Chairman Bernank come to
the Hill and, you know, to

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present kind of what was happening because
all of a sudden, incredible amounts of

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activities. Bear Stearns was in trouble, AIG was in trouble, like all

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of this activity was going on.
And it was a first meeting in which

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we expanded it to more than just
leadership staff, and that was the banking

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staffs and financial services and all the
different staff in the room. So it's

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probably about fifty people with principles and
staff. And you know, I'll never

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forget Secretary of Pulse and asking,
okay, just want to understand the room,

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who has ever traded a derivative?
You know, no hand goes up

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and he's like, Okay, who's
ever worked on Wall Street? Not a

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hand goes up and he's like,
okay, so this is going to be

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a theoretical exercise. And you know, he you know, slowly educated us

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all on kind of some of the
nuances. But you know, he was

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an own personal relationship that he had
with the Wall Street community and others that

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kind of helped us lead us to
a place where we ended up getting to

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with the TARP and other aspects.
But that kind of illustrated how important it

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is to again maintain that conversation,
develop those relationships. So when there is

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a time of crisis or need or
trying to think forward, how do we

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reshape the United States? You know
right now on kind of what this future

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of finance looks like, that process
is there, and so that's kind of

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translated to where I am now.
I came into this role working at a

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firm called Invariant, a lobbying and
public affairs firm, and we had several

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fintech clients and it was them that
recruited me to ask if I'd be interested

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in building out this new trade association
that represented the larger industry Okay, great

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now. I love that anecdote about
Sexuary Paulsen. During the Great Financial Crisis,

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I also did a lot of campaign
work, although I didn't translated that

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into later careers. After college,
I went directly into financial services. And

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I always tell people that campaign politics
is in many ways kind of a hand

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to hand combat, and it really
prepares you for a lot of difficult situations

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over the course of your career,
and I think people who have that experience

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tend to kind of roll with it. Challenging things happened because you started out

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early with difficult bosses and a variety
of experiences, you know, in a

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way, I was actually working at
Smith Barney at the time, which does

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not exist as a company anymore.
So I was working for an institutional consulting

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team, certainly d of Spelt,
and saw the industry disruption firsthand. Although

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although not in New York or DC. Were there times during those years where

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you felt like, we don't know
where this is going to end, and

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we think the landing could be could
be very very hard, and just the

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unknowns, Like what was that like
from a I think emotion standpoint of really

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being in the room where a lot
of really important things happened. It was

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you know, you didn't know,
you didn't know how big the contagion was,

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you didn't know, you didn't necessarily
know other than the banking community also

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what was being affected. And then
you had the global component on it.

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And so it was every hour,
every day realizing this. Well it might

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have just seemed isolated initially to a
housing and to Wall Street and to some

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niche products that were you know,
oversecuritize or over exercise. It. Then

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every day became bigger and larger,
and then you had multinational companies saying,

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I can't make payroll. The banks
have called the paper we leverage on a

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daily basis just to meet payroll.
We're going to go under. And these

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are major, major, multinational,
non bank companies that were starting to feel

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these overall effects. Let alone the
hundreds of thousands of people that lost their

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homes and trying to find, you
know, a new way or how they

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were going to live as well.
So it was just this kind of this

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complete uncertainty and you know, wanting
to you know, not know, and

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especially initially where to put the finger
in the dike. You know, it

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wasn't which problem to solve it wasn't
just one sector that we could solve for,

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it was multi and so I credit
the leadership of Secretary Paulson and Chairman

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Bernanke and the Fed governors that were
involved, and the leadership in the House

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in the Senate to be able to
look at the landscape put politics aside.

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And there was you know, some
obviously some very partisan, you know,

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features that have to work through,
but you know, to go to the

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White House and have Speaker Pelosi,
to have Leader Read, to have McConnell,

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and to have others there putting aside
and saying what do we need to

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fix this so it's not an overall
collapse. And so that was what you

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just didn't know. You didn't know
where the floor was and which finger to

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put in what you died, you
know at that point. Sure. Yeah,

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there's a great quote that I heard
the other day, and I can't

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recall offhand where I heard it,
but I've repeated it and it's been repeated

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by a couple of my colleagues here
at upstart that you have to be willing

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to sprint when the distance is unknown. Yes, exactly, Yeah, and

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that is very much true when growing
either a startup or a company through kind

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of rapid growth phases and after well
Smith Party became no more, I did

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have the opportunity later on to work
at JP Morgan and the Federal Reserve,

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and reform around triparty repo and white
paper was something that I helped implement at

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the Bank as we were as I
managed one of the teams that worked on

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the global liquidity trading there, and
so that was certainly interesting to then see

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some of the cleanup. What are
some of the other kind of industry changes

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you saw coming out of that,
like some of the positive things that you

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feel like we're really done well in
addition to the kind of bipartisan work to

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clean up a big problem, but
maybe like new regulation or new oversight that

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came out of that. Yeah,
well, I think, you know,

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plus or minus whatever your opinion is
on the Consumer Financial Protection Bureau, you

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know, the creation of that bureau
has a positive effect. It now has

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again depending on the directorship or depending
on where your perception would be, but

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just having the notion that there is
a regulatory body being a perspective of what

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is best for the consumer. How
that's interpreted is I'll leave that to others.

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But that was something I think that
has been overall positive to have that

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notion and to have a place where
consumers can go, consumers can have a

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voice, and at the same time
thinking through the products and services that are

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in the marketplace to ensure that there
is consumer protection components to it that might

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not have been there prior, because
you do not want you want to make

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sure that every product coming into the
marketplace, especially that with money that touching

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consumers in small business, has the
full safety and soundness, that there is

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a fairness element to it as well, but can instill the trust of the

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users for it. So I think
that was, you know, something that

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was good. Obviously, some of
the aspects in the mortgage industry, some

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other forums that have taken place when
that respect have been good. Some of

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the other consumer protection asked of some
of the financial sectors. I'll let others

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debate currently on Basel three endgame,
but you know, there was obviously a

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higher capital requirements, some of the
work done on the testing of the banks

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and the stress testing, and you
know, just ensuring that there was a

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greater dialogue occurring between again between Washington
and what was happening on Wall Street.

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I think has been overall a positive
event. Sure, sure, And I

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know you know here at Upstart,
there's kind of a funny story about some

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of our founders and early employees kind
of walking into the OCC office in San

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Francisco and just saying, Hey,
we're going to do this thing and do

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you want to talk to us?
And that isn't very common practice, so

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the regulator didn't really know what to
make of them at the time either.

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But we've got a long standing history, you know, through our work and

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our government affairs team and engagement of
our risk and compliance teams of working with

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the various regulatory agencies kind of opening
up the company as much as possible,

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and then obviously where we have we
do have state exams as a lender or

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as a broker, and kind of
indirectly through many of our bank partners and

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credit unions that we work with,
So you know, we spend a lot

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of time, I think engaging with
the regulators. And I definitely think that

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your experience, having kind of seen
the worst of what can go wrong and

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where things can spiral pretty quickly,
is really helpful. And there are certainly

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areas in the fintech industry where people
may not have that kind of global banking

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perspective and have not seen things go
wrong. They've only seen it go up.

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And I think last year opened some
people's eyes with the bank failures and

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the kind of after effects of stimulus
wearing off. So I know you've said

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before that the FTA is really working
to use innovation to better those consumers and

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small business outcomes. What are some
of the products and services being developed or

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kind of in the market as you
see most innovative or that you're really excited

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about right now? Yeah, I
would say that, you know, and

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again going back to what you asked
about coming out of eight, I would

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say, separate from the regulation space, the innovation what has occurred, and

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you see a lot of products that
came out in response similar to started others

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that were filling a marketplace gap,
because what you did see was still the

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need for access to credit, access
to affordable credit and in a way that

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could you know, reach those that
might not have a credit report under bank

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underserved, but do it in a
way that's not predatory, that does it

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in a way that allows them to
be able to buy a home, finance

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a car, other means, but
not in a way that puts them in

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incredible revolving debt or in compounding interests, you know, vehicles on that respect.

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So I think there's been a lot
of incredible innovation. And as we've

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gone and you saw another uptick,
especially on adoption during the pandemic when people

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are at home, not going to
a bank and having to relive their financial

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lives and one that is much more
digital. And so a lot of the

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innovation in this space has been you
know, from that from changing the way

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in which we interact with financial services, how we get the delivery of money,

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how we're able to just kind of
work on that aspect. But it's

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also just some foundational just for the
ability for you to accept a credit card

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online, the ability for you to
for a small business to be able to

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have one place where they can do
their bill pay, manage their treasury,

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all of that aspect of their whole
you know, get access to credit is

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now something that can that is an
everyday occurrence. So, you know,

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some of the products that are in
this space that I think that are really

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exciting, again building on what some
of the foundational things was, I think

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now it's just taken for granted that
oh yeah, I can get my door

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dash delivered and with a debit or
credit card and it's seamless, and not

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realizing it probably goes over four or
five of our live intech rails to make

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that happen. It just seems ubiquitous
and seamless. But what you are aren't

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starting just the availability again from a
small business and consumer, that access to

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credit and access to more affordable credit. You know, acting controllers who likes

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to say being poor is expensive because
it requires you oftentimes to get a higher

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you know, they require a higher
interest loan, or they require you know,

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more having more liquidity or denial of
certain aspects. So you know,

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what we did see during the pandemic, especially you know, was trying during

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the first phase of the PPP was
trying to get money out the door if

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they could, you know, people
without bank accounts or without relationships with their

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bank, they weren't able to access
you know, this incredible program. And

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so just that kind of overall need
to be able to meet consumers and small

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businesses where they're at using digital tools
that they want and provide consumers with more

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choice in the marketplace. Sure,
sure, and I do think that that

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is always a good quote that being
poor is expensive, and I think we

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all know the stats around you know
what simple emergency like a car breaking down,

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a medical bill, unexpected sickness where
you're out from work, and how

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impactful that can be on a pretty
large set of population of Americans. I

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think one of the new products that
I know all of our listeners are familiar

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with or newer products not new anymore, is by Now Pay Later or BNPL

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kind of the point of sale financing, whether online or in store. I

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do think the reputation sometimes can be
a bit mixed. People think it's a

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lot of things and aren't exactly sure
what it is, especially if they don't

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work directly in the fintech industry.
Can you share your thoughts though, what

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you see some of the benefits of
those products, particularly for those consumers.

259
00:19:49.400 --> 00:19:56.079
Yeah, by Appay Later is kind
of almost turned into a marketing theme,

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a marketing tool versus what it actually
is. And you know it started,

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you know, it started originally in
Australia and in Europe and again to that

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point of sale financing and for the
traditional BNPL, I would say it's still

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so new. You know, it's
a zero to low interest product in which

264
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you're able to make four payments over
the course of six weeks to pay for

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a product. So it's a great
tool again bringing competition into the marketplace.

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It allows people, you know,
just an alternative payment if they need to

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spread their payments again to meet their
paychecks or whatever the case might be,

268
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or to address it an emergency immediately, they can do it in a way

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again that has the zero interest do
it in a way that when they pay

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it off in four weeks, they
don't occur any other fees attached to it.

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So it's a lower cost option that
allows you to spread your payments over

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forre So yesterday the New York Post
or the New York Fed put out a

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blog on their recent research, and
you are starting to see, you know,

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a lot of folks having and we
saw it during the holidays and uptick

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and kind of the use of by
now pay later as we would define it

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to pay in for zero to no
interest products. And that's because just again,

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people want alternatives in the marketplace to
be able to use a product,

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a payment product that fits their need. You know, back in the day,

279
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I remember when credit cards started to
get more adopted and the first time

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I used it in a grocery store. My dad was appalled, you know,

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He's just like, how come you're
using a credit card? And I

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was like, well, one,
it's convenient too. I'm not incurring interests

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because I was only paying paying what
I could afford at the time. And

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so I said, for me,
it's just convenience and I'm not incurring any

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other fees that I wouldn't any otherwise. And so you know, now it's

286
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just ubiquitous and everybody's now you know, tapped to pays, you know,

287
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with credit card or others, so
you know that adoption. We're starting to

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see similar to buy now prelator as
an alternative payment that helps people budget and

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finance their needs. Sure, and
I'm not sure. I think my parents

290
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do primarily use cards now, but
they've been slow adopters in that way too,

291
00:22:12.039 --> 00:22:15.480
where it was always a sense of
why would you use a credit card

292
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if you have the money, and
there's a lot of reasons. And I

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do see a lot of the credit
card companies now offering the payover time feature,

294
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which is kind of an embedded short
term installment pay over four months instead

295
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of having that a crew interest and
hit your balance and have more of a

296
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variable monthly payment. But of course
then you have to qualify for that credit

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card the first time, which I
think a lot of there's probably a good

298
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chunk of buy now, pay later
frequent users who may not have qualified for

299
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that yet. Yeah, and a
lot of bany now prelator eighty five percent

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00:22:45.000 --> 00:22:49.119
use a debit card, so they
do. There's an allergic or an allergy

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I guess to credit in that sense. And you saw that shift after eight

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where either they saw what their parents
had gone through or others around them,

303
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and so there is that more default
into a debit account versus a credit card

304
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use of credit cards, So that's
a shift in consumer behavior as well.

305
00:23:10.440 --> 00:23:12.319
Interesting. I can definitely see that, and I think the you know,

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I know you and I talked before
about BNPL and credit reporting, and we've

307
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certainly talked about that at Upstart,
as we use a lot of consumer credit

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data as inputs to our underwriting model. I know some of the different companies

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have taken different different taxs with do
they report the first line? Do they

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only report of it's negative? Does
it have to be over a certain amount

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of time? And it doesn't seem
like there's a lot of kind of standardization

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yet, and I think you could
you could certainly argue that it may you

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00:23:41.839 --> 00:23:45.000
know, kind of hide the risk
or obscure somebody's real DTI. Do you

314
00:23:45.000 --> 00:23:49.079
think that's valid or do you think
that's more of a kind of theoretical fear

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of new products that people may not
fully understand. What's unfortunate right now is

316
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is it's hard for credit viureaus to
capture the positive aspect of somebody that uses

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bind now pay later in a responsible
manner, in a way in which they're

318
00:24:07.599 --> 00:24:11.359
paying it off each cycle or you
know, each four week period and doing

319
00:24:11.400 --> 00:24:15.039
it, you know, repeatedly,
and not being able to build positive credit

320
00:24:15.319 --> 00:24:21.000
because right now it happens if you
take out one, two or three different

321
00:24:21.160 --> 00:24:26.039
BNPL loans or use BNPL products,
you're maxing out your amount of available credit,

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which could seem as a negative.
And so until we solve some of

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those issues within just they weren't the
credit vearas weren't built to capture daily transactional

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00:24:38.319 --> 00:24:44.880
information, two week transactional information.
They were more capturing or still try to

325
00:24:44.920 --> 00:24:48.359
capture, you know, those large
larger payments, monthly payments that you do

326
00:24:48.440 --> 00:24:55.839
for home and utility car and other
aspects of it. So that ability,

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00:24:55.880 --> 00:25:00.440
I think there's a hesitancy until you
can fix that issue and for them to

328
00:25:00.480 --> 00:25:06.039
be able to really understand a the
frequency, the amount, the regular cadence,

329
00:25:06.079 --> 00:25:08.240
that it's not maxing out a credit
in a negative way, but yet

330
00:25:08.480 --> 00:25:12.839
in four weeks you can show somebody
you know with a responsible repayment and that

331
00:25:12.880 --> 00:25:18.519
should be seen as a good credit
indicator. Those are some of the hesitancy

332
00:25:18.559 --> 00:25:22.200
that you have in the marketplace.
And then with only three bureaus, there

333
00:25:22.240 --> 00:25:26.640
is not harmonization across each and so
viewing each of this data in a very

334
00:25:26.640 --> 00:25:33.160
different way is something that is just
too comferssome for the companies to report into

335
00:25:33.279 --> 00:25:37.720
because it will be translated differently depending
on the company in which they're engaged with.

336
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So just a little bit of the
word. I think the bin Now

337
00:25:41.880 --> 00:25:47.880
failure industry is ahead of the market
as far as on the credit reporting side.

338
00:25:48.200 --> 00:25:52.720
But it's something that you know,
our own companies work with very bin

339
00:25:52.720 --> 00:25:56.680
now pailaor work with the consumers and
there's protections built into them, you know,

340
00:25:56.759 --> 00:25:59.319
you pause, you know, if
someone is laid on a payment,

341
00:25:59.359 --> 00:26:03.359
they are from using that product again
until that is satisfied, so they are

342
00:26:03.400 --> 00:26:07.559
in their own underwriting, they're trying
to mitigate that risk as well and not

343
00:26:07.640 --> 00:26:12.640
put somebody in over extension. And
these are often I think the average right

344
00:26:12.680 --> 00:26:17.440
now use of a VNPL product is
like one hundred and forty seven dollars,

345
00:26:17.440 --> 00:26:22.319
so it's a very low It's a
much different product than like I say,

346
00:26:22.359 --> 00:26:26.920
a mortgage or a car, or
purchasing a large purchase. These are very

347
00:26:26.039 --> 00:26:32.039
very small oftentimes are very small purchases
that are used on a frequent basis.

348
00:26:32.599 --> 00:26:34.920
Sure, and I do think a
little bit of the just novel mess of

349
00:26:34.960 --> 00:26:38.960
them is in the unknown around that, because it certain people can certainly get

350
00:26:38.960 --> 00:26:44.519
themselves into a significant amount of trouble
quickly with credit cards, and the fees

351
00:26:44.559 --> 00:26:48.319
and the interest can build up to
a place where they can't support those payments.

352
00:26:48.599 --> 00:26:51.839
I know all of the credit bureaus
have built various kind of features and

353
00:26:51.880 --> 00:26:56.240
products to think about kind of those
off tradeline payments like utilities and cell phone

354
00:26:56.279 --> 00:27:00.960
bills and rent, and how do
you give people kind of credit for those

355
00:27:00.000 --> 00:27:04.799
sorts of activities to help kind of
build their credit profile and have a more

356
00:27:04.880 --> 00:27:08.839
visible risk footprint. I think one
of the other newer products. It's getting

357
00:27:08.839 --> 00:27:11.839
a lot of attention and all of
our listeners may not be as familiar with

358
00:27:11.880 --> 00:27:15.400
it is earned wage access, which
you had mentioned earlier. Can you talk

359
00:27:15.440 --> 00:27:18.039
a little bit about just what that
is, what that means, and what

360
00:27:18.079 --> 00:27:22.519
are some of the solutions you're seeing
out there. Yeah, and I would

361
00:27:22.519 --> 00:27:26.079
say it's kind of broken down to
what you defined it as in the sense

362
00:27:26.119 --> 00:27:32.160
of it's earned wage access, and
so it's access to your already earned wage.

363
00:27:32.599 --> 00:27:36.000
As we know, often times here
in the United States, we are

364
00:27:36.039 --> 00:27:41.599
paid either every two weeks or once
a month. And to your earlier point

365
00:27:41.640 --> 00:27:45.279
in the conversation about there are times
when people need liquidity, they need access

366
00:27:45.319 --> 00:27:51.279
to funds prior to a two week
pay period for a variety of reasons,

367
00:27:51.440 --> 00:27:55.240
or they would just like you know, we do have a lot of folks

368
00:27:55.240 --> 00:27:59.720
that use earned wage access as a
budgeting tool. They know, you know,

369
00:27:59.799 --> 00:28:03.440
if they get it funds on a
more steady basis, they know exactly

370
00:28:03.440 --> 00:28:07.000
what they have to spend. So
there's a variety of reasons, but essentially

371
00:28:07.039 --> 00:28:11.680
it's to help tide over in between
work periods. It's based on what you've

372
00:28:11.720 --> 00:28:15.359
already earned, so when you go
to work on a daily basis. You

373
00:28:15.359 --> 00:28:18.640
know, back in the day,
it would be like can I get a

374
00:28:18.759 --> 00:28:21.079
Can I get it? Maybe a
cash advance, and it was you know,

375
00:28:21.400 --> 00:28:23.559
money taken out of the till at
the end of the night and you

376
00:28:23.599 --> 00:28:27.359
know, given to you and with
the promise of being paid back. It's

377
00:28:27.440 --> 00:28:33.039
kind of in that same vein now
obviously in a digital manner, and so

378
00:28:33.119 --> 00:28:38.160
it's allowing people to have access to
the wages on a daily basis or on

379
00:28:38.200 --> 00:28:42.759
a depending on their frequency, on
a regular basis based off of kind of

380
00:28:42.759 --> 00:28:47.480
what you've already earned. So that's
what these that's the innovation that is happening.

381
00:28:47.799 --> 00:28:52.480
There's two different i would say ways
in which to in which it clows.

382
00:28:52.920 --> 00:28:56.359
One is employer based, so you
work at many companies are working directly

383
00:28:56.400 --> 00:29:00.880
with an employer and it's an added
benefit that they buy to employees. And

384
00:29:00.920 --> 00:29:06.519
then the other is direct to consumer, where you have companies in this space

385
00:29:06.599 --> 00:29:11.400
that those that don't have employers,
such as you know, the United States

386
00:29:11.440 --> 00:29:15.559
House a representative only pays once a
month and so there's we have a couple

387
00:29:15.680 --> 00:29:22.880
hundred house members or house staffers that
use the product that obviously the employer does

388
00:29:22.920 --> 00:29:26.559
not pay, so you have you
know, employers or employees that perhaps are

389
00:29:26.640 --> 00:29:32.680
gig workers ten ninety nine or their
employer is not engaged in an earthen wage

390
00:29:32.759 --> 00:29:37.039
program that allows them again to be
able to have access to their wages sooner

391
00:29:37.039 --> 00:29:41.000
than their pay period. Sure.
Yeah, and I think that can be

392
00:29:41.160 --> 00:29:44.559
certainly meaningful to you. You know, from the products that you're seeing out

393
00:29:44.559 --> 00:29:48.799
there, are you seeing where people
are kind of generally using those on a

394
00:29:48.839 --> 00:29:52.000
regular basis. Is it they like
to have the safety and security of getting

395
00:29:52.000 --> 00:29:56.720
advanced access if needed, or is
it kind of a mix of behaviors as

396
00:29:56.759 --> 00:30:00.400
those are getting more popular. Yeah, it's really a mix of be behavior.

397
00:30:00.720 --> 00:30:06.000
It depends on kind of what the
needs of the person is. Some

398
00:30:06.240 --> 00:30:08.119
that you know, like I said, want to use it as a budgeting

399
00:30:08.160 --> 00:30:11.720
tool so they know, you know, exactly how much they have to spend,

400
00:30:11.839 --> 00:30:15.880
either on a daily basis or on
a more frequent basis. Some that

401
00:30:17.359 --> 00:30:21.480
need a car to work, car
breaks down, they need access to a

402
00:30:21.759 --> 00:30:26.559
load cost, low fee, no
fee product because right now altron it is

403
00:30:26.599 --> 00:30:30.759
in the marketplace. Are one that
do have high interest based on you know,

404
00:30:30.839 --> 00:30:36.000
trying to trap you into you know, they make money when your behavior,

405
00:30:36.559 --> 00:30:37.640
you know, when you aren't able
to make a payment, when you

406
00:30:37.720 --> 00:30:42.319
aren't able to satisfy an obligation,
that's how they make money. So they

407
00:30:42.359 --> 00:30:48.359
want to push you into a risky
behavior, which you know help them.

408
00:30:48.400 --> 00:30:52.440
Whereas these products are, you know, there's no recourse, there's no interest,

409
00:30:52.519 --> 00:30:56.000
there's no fees attached. There is
an aspect of them that you know

410
00:30:56.079 --> 00:31:00.799
allows you to have access to your
earned wage on more free basis. So

411
00:31:00.400 --> 00:31:06.359
mixed use on kind of why and
how people use it. Great? Great,

412
00:31:06.440 --> 00:31:10.240
Well, I think one really last
question that I think I'd like to

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00:31:10.240 --> 00:31:12.039
get your thoughts on. You know, we've talked certainly about some of the

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00:31:12.039 --> 00:31:15.799
new products and some of the risks
out there, but really like, how

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00:31:15.799 --> 00:31:21.119
do you think about these either novel
or emerging financial products, Like in what

416
00:31:21.160 --> 00:31:25.599
ways can they be a positive impact
to consumer credit reports and not just their

417
00:31:25.640 --> 00:31:29.799
credit report but really just their overall
financial health and wellness. Yeah, I

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00:31:29.799 --> 00:31:33.279
mean, eventually you would want to
be able to have this data available,

419
00:31:33.440 --> 00:31:38.799
the frequency of use, those that
are repaying their obligations on a steady and

420
00:31:38.839 --> 00:31:45.079
regular basis, you know, just
that they're showing and demonstrating responsible behavior that

421
00:31:45.119 --> 00:31:49.799
should be rewarded either on a higher
credit score or allow them to have to

422
00:31:49.839 --> 00:31:55.000
your point, you know, to
have them to have access to more capital,

423
00:31:55.119 --> 00:31:56.799
to you know, if they want
to start a small business, if

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00:31:56.799 --> 00:32:01.359
they want to you know, use
it for a variety of different matters and

425
00:32:01.480 --> 00:32:07.319
means. So I think the positive
aspect is that there are loafe, low

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00:32:07.480 --> 00:32:13.799
cost, affordable products that are now
coming into the marketplace that allow consumers and

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00:32:13.880 --> 00:32:17.960
small businesses to have access to this
affordable capital, to be able to one

428
00:32:19.119 --> 00:32:22.160
live at healthier life, to meet
the needs of themselves and their family.

429
00:32:22.480 --> 00:32:28.119
Three, be able to start incredible
businesses without having to go into so much

430
00:32:28.160 --> 00:32:31.400
debt, but to be able to
really strive in this economy. Sure,

431
00:32:31.440 --> 00:32:36.359
and I'm excited to see over the
next kind of five to ten years where

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00:32:36.400 --> 00:32:38.640
things had I think, you know, we're certainly seeing that the states aren't

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00:32:38.680 --> 00:32:45.960
quite sure where they should regulate where
the federal legislation which agencies are in charge

434
00:32:45.960 --> 00:32:49.519
of wide and I think it'll be
some It's great to have organizations like the

435
00:32:49.920 --> 00:32:52.799
FTA out there kind of leading the
charge and working through these issues. But

436
00:32:53.640 --> 00:32:57.759
thank you very much, appreciate the
conversation. Glad to have you on the

437
00:32:57.920 --> 00:33:00.400
podcast and just thanks for your time
today. Thanks Lind so much for having

438
00:33:00.440 --> 00:33:06.359
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439
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