About a year ago, a friend set up a call for me with Suze Orman, while she was still planning her Approved Card. She was somewhat weirdly obsessed with the vision of a digital cash economy. No paper. No credit. Also, not realistic. General purpose prepaid has basically gotten a…
I’m Stuffed: the importance of full file in alternative credit
The House Financial Services subcommittee contemplated a new Act today. It goes by H.R.6363, but its friends know it as Credit Access and Inclusion Act. Basically, it encourages utilities to report to the credit bureaus information about whether I pay, or do not pay said utility on time. This is interesting because…
More than one in four Americans are Unbanked or Underbanked
The FDIC updated its 2009 figures (based on 2008 Census data) of who uses what kind of basic financial services and released them yesterday. It’s not just any four years later, but marks a period that represents significant change in the economy and individual American’s lives. What did we learn?…
Can the Private Sector Bailout Student Borrowers?
Today’s WSJ headlines with a story on how even the mass affluent are struggling with student debt. Our summer associate, Aaron Mercurio, has been working on a private student lending investment thesis for us, and opines the following: We know student loans are important and we’re often reminded that they’re…
Society’s protections for life does not extend to livelihood
Dating back to the 12th century, western medical professionals have signed the Hippocratic Oath. Most US medical schools require their students to sign some form of this oath, swearing to practice medicine ethically and honestly, and never to do harm to anyone. While the Oath has been modernized and is not…
Barclay’s cheese may or may not contain dairy product
I try to avoid eating food that “may or may not” contain some ingredient, especially if it’s not even clear what that ingredient is (milk product?). Barclay’s new Ring credit card, I’m afraid, looks tremendously tasty and innovative, but while poking through their Terms of Service over lunch just now,…
The most prized ideas
A couple weeks ago, at the Underbanked Financial Services Forum, we asked people for big, wild ideas for serving the underbanked: our portfolio companies showed their strength to standing-room-only crowds, four companies battled in the Core Challenge, a modest group of Tweeters threw caution to the wind, and the largest…
Compass Principles: Moving in the Right Direction
My partner in crime, Jennifer Tescher, who runs the Center for Financial Services Innovation, is leading a bold movement to increase quality in consumer finance. High time! Here’s what she has to say: Given the high level of consumer confusion and distrust, the Center for Financial Services Innovation (CFSI) set out in…
2012 Underbanked Innovators Challenge Finalists
We received many nominations for the best innovation serving the underbanked in America. Mostly startups, but also some big companies, including banks. Mostly payments, but also credit, savings and financial capability solutions. Mostly true innovations, but also quite a few doozies. Our judges looked for true innovation, demo-ability, and also…
Impact Advantage: Our view on impact investing and the double bottom line
We are a double bottom line fund. This means that we target excellent financial returns (first bottom line) and measurable positive social impact (second bottom line). When most people learn this, they assume we are a no-bottom line fund. I’d like to explain why this is an entirely reasonable misperception,…