Republic Bank of Chicago, Halikias company, has always offered its customers a wide range of financial services. From personal to business needs, they offer services that deliver what customers want. A recent article on SF Gate explores the trend of more retailers moving into financial services. Republic Bank of Chicago, Halikias company, responds to this move by retailers and how it is received.
According to the article, big-box retail stores are beginning to expand their services into the financial realm. Check cashing, reloadable pre-paid cards, small business loans, and life insurance are all becoming more widely available. With ever busier schedules, consumers are attracted by this convenience. One-stop shopping now includes more services than ever. They can avoid overdraft fees, tight credit, and minimum balance requirements that they experience at banks. The drawback is that these retails don’t receive the same federal oversight that banks do. This may result in fewer consumer protections than banks offer.
According to a 2011 survey by the Federal Deposit Insurance Corp., one in 12 American households don’t have a checking or savings account. That adds up to approximately 10 million households. One in five, or approximately 24 million, households rely on alternative financial services in addition to their accounts. These services include non-bank money orders, check cashing, payday loans, tax refund loans, and pawnshops. Retailers are raking in more than $78 billion annually from fee and interest revenue.
The article highlights Costco and its vast services. Mortgages, identity protection, and boat and RV loans are all now available. Some locations even offer auto, home, and health insurance. Jay Smith, director of business and financial services for Costco in Issaquah, Washington, says that with the popularity of mortgages, they continue to grow that service. Members are beginning to notice the value of the services they now provide.
Costco is not the only company offering what customers are looking for. Home improvement loans are available at Home Depot for upwards of $40,000. Wal-Mart has become very involved in offering financial services. According to the article it offers “tax preparation, check cashing, in-store bill paying, money transfers, and prepaid cards that function as debit and checking alternatives.” It has even partnered with American Express to offer a Bluebird card.
The article describes the Bluebird card as a reloadable card that “allows direct deposits and pre-authorized check writing; has no monthly, annual or overdraft fees; and may carry a balance of up to $100,000.” According to Wal-Mart, it is also eligible for FDIC insurance. This allows customers to deposit government payments including Social Security, military pay, and tax refunds. They aim to serve customers who don’t have bank accounts, or are unhappy with traditional bank services and associated costs.
Wal-Mart isn’t stopping there. Select stores in Georgia and South Carolina are experimenting with the sale of life insurance policies. By purchasing a prepaid card, they pay for a one-year term with MetLife. They call the toll-free number on the back to activate their policy and speak with a licensed agent. In 2007 Wal-Mart had tried to establish its own bank but soon withdrew its application. The banking industry and lawmakers put up a fight to oppose their efforts. Even without becoming a bank, it still offers a variety of financial services similar to banks.
The article explains that retailers are able to offer these services by partnering with third-party credit card companies, lenders, and insurance agents. The director of financial services at Home Depot, Brandon Hayes, said that once customers apply at the store, their application is sent to a financial provider. Their loans are backed by mid-tier banks. It is marketed as a Home Depot product, but the lending comes from the banks.
These retailers are competition in the eyes of banks, however. They are offering similar services but are not held to the same federal regulations that banks are. Some see it as an unfair advantage. Retailers disagree. The article quotes Sarah Spencer, a Wal-Mart spokesperson. “We have a positive ongoing dialogue with relevant regulators and believe that our products are properly and adequately regulated. In many cases, the regulated entity is the financial services partner that ‘manufactures’ the product.”
There is rising concern over the lack of legal safeguards. With the increasing interest in prepaid cards, there are still associated risks to consider. Issuers are not required to disclose their fees. Customers are not guaranteed their money back if their card is lost or stolen either. Some issuers have chosen to offer customer protections, but they are not required to by law.
According to the article, the Consumer Financial Protection Bureau has proposed new rules in regards to prepaid cards. Richard Cordray, the bureau’s director, said, “All consumers need, and deserve, products which are safe and whose costs and risks are clear upfront.” Before investing in prepaid cards, consumers should read the fine print. They should compare what retailers have to offer versus what banks can offer.
Republic Bank of Chicago, Halikias, shares the concern of other banks regarding retailers offering financial services. “Major retailers are developing financial products aimed at the unbanked,” states a bank representative. “However, these retailers are not subject to the same regulatory scrutiny as banks. Bankers as well as consumer protection groups want retailers that offer financial services to be supervised and examined by the same federal regulations that oversee banks. This oversight serves to protect everybody. If they want to jump in the ring, then they should play by the same rules.”
Republic Bank of Chicago, Halikias, offers its customers a wide array of services at reasonable costs. They are a member of the FDIC and an equal housing lender. They are committed to meeting high standards of quality and service. They protect their customers and their investments. Republic Bank of Chicago, Halikias, strives to meet the needs of its varied clientele, providing creative financial solutions.
Republic Bank of Chicago, Halikias company, is a network of community banks serving the Chicago area. With 16 convenient locations, customers are never far from friendly, helpful service. They offer personal checking, savings, and money market accounts, along with several types of loans. They also provide similar services to business clientele. Online banking access makes managing funds even easier.