CA-based Green Dot, a major prepaid card specialist, is acquiring Santa Barbara Tax Products (TPG), the nation’s largest consumer tax refund transaction processor. The move will greatly expand Green Dot’s financial services for low and moderate income consumers.
The Prepaid Visa RushCard now offers consumers a convenient direct deposit alternative for receiving their income tax refund. With direct deposit to a RushCard, tax filers can now receive their refunds faster, safer, and more conveniently this tax season. The company is also set to participate in the Visa Prepaid 2013 Tax Sweepstakes for Refund Load, where those who enter the sweepstakes or load their refunds onto eligible Visa Prepaid cards are automatically entered to win free family groceries for a year. RushCard users agree that setting up a tax refund directly to their card is easy and effective. Before getting a RushCard, more than a third received their check through the mail (36%) but now, nearly all (90%) of RushCard users who chose direct deposit to receive their tax refund last year plan to do it again this year.
Intuit posted its financial results for its second fiscal quarter, which ended Jan. 31, with revenue up 5% to $878 million since the year-ago quarter. For fiscal year 2011, the company expects revenue of $3.74 billion to $3.84 billion, growth of 8 to 11%. Intuit’s Payments Solutions revenue grew 7% compared to the year-ago quarter, merchants grew 14% compared to the year-ago quarter and transaction volume per merchant grew 1%. Meanwhile, internet banking users increased by 10 percent, while bill pay users grew 23 percent compared to the same quarter last year.Small Business Group revenue increased 15% compared to the year-ago quarter, for which Financial Management Solutions revenue increased 21% compared to the year-ago quarter. Total Small Business Group revenue grew 15% compared to the year-ago quarter. Growth in small business was led by strength in Financial Management Solutions and Employee Management Solutions. With this, the Company is projecting revenue of $1.76 billion to $1.83 billion for the next quarter for growth of 10-14%.
The U.S. Treasury Department launched a national pilot to deliver prepaid cards at tax time, which will be provided by Green Dot. This welcomes a new era in the prepaid industry and, according to CFSI, the Federal government could potentially save tens of millions of dollars a year through issuing refunds electronically.
The U.S. Treasury Departmentâs announcement of a 2011 pilot program to test the delivery of tax refunds via debit card accounts represents a critical milestone by the Obama Administration to ensure millions of underbanked consumers have access to well-designed transaction products. The pilot program, which was deeply informed by the Center for Financial Services Innovationâs SAFE-T Accounts proposal. The CFSI disclosed the Federal government could potentially save tens of millions of dollars a year through issuing refunds electronically in lieu of much more costly paper checks. The tax time accounts will also introduce more underbanked consumers to the potential and utility of such financial products and broaden the overall market for these and a variety of other financial services and products.
Value Payment Systems and RBS WorldPay announced that the companiesâ “payUSAtax” tax payment service will now accept MasterCard cards for U.S. IRS Federal tax payments. For the 2009 tax year, MasterCard cardholders can now experience greater speed, convenience and security when paying their federal taxes online at www.payUSAtax.com for a reduced convenience fee rate of only 1.95%. Taxpayers who use their MasterCard when filing their Federal taxes with payUSAtax can earn rewards, schedule automated payments, set future payment e-mail reminders and deduct the convenience fee on their tax return. The “payUSAtax” service, individual taxpayers can make secure tax payments for 1040; estimated taxes; installment payments; tax extension; trust fund recovery penalty; amended tax returns, and many more.
At the consumer level, a debt crisis is underway and has been since the beginning of the recession, signaling a need for credit card debt relief programs. For much of the last 30 years, consumers and businesses that struggling under the weight of credit card debt had only bankruptcy and debt consolidation/home equity loans as life raft. These, however, can be extremely risky endeavors to undertake. According to Total Debt Relief, the modern day debt relief programs offer the most effective credit card debt relief programs. This includes Debt Settlement, allowing consumers and businesses to collectively have shed debt by the hundreds of millions of dollars in 2009 alone. In this program, a debt settlement firm will aggressively negotiate on behalf of the consumer or business in debt to reach a compromise settlement, which in most cases is a 50 percent reduction in the amount of debt that is owed.
Intuit has rolled out “TurboTax for Online Banking”. TurboTax for Online Banking guides users through their return, helping
them get every deduction and credit to which they are entitled so they
get the maximum refund possible. Users can also file their returns
electronically and direct deposit refunds in up to three accounts.
More than $33 billion in tax refunds already flow through TurboTax. More
than 90 percent of people who tried “TurboTax for Online Banking” during
pilot testing who received a tax refund direct deposited that refund
with the financial institution that offered the service.
Consumers whose financial institutions offer TurboTax for Online Banking
can pre-populate their tax forms with tax data from online banking to
save time. This will help people quickly and easily prepare, plan and
file tax returns within an online banking session; no additional log in
required. The solution can also be integrated with FinanceWorks, the
award-winning online financial management solution from Intuitâs
financial institutions division, Digital Insight, to make tax
preparation even easier for tax filers. FinanceWorks helps online banking customers gain greater visibility and
control over their spending with access to account information from more
than 12,000 financial institutions and credit card sites.
Business bankruptcy filings are running 80% above one-year ago and have more than tripled compared to two years ago. During June more than 10,000 bankruptcy filings were made by small businesses, a new record. According to Equifax there were 10,339 business bankruptcy filings in June, up from 5,712 a year ago. According to the Administrative Office of the U.S. Courts total business bankruptcy filings in the first quarter were 14,319, compared to 12,901 in the fourth quarter and 8,712 in 1Q/08. Based on the 81% increase reported by Equifax for June, second quarter 2009 business bankruptcy filings will likely top 17,500 and the third quarter could approach 20,000. Equifax says the latest data show California is the most negatively affected state with 10 MSA’s among the 15 areas with the most commercial bankruptcy filings during June. The other MSA’s with the most bankruptcy filings during the month include: Charlotte-Gastonia-Concord, NC-SC; Atlanta-Sandy Springs-Marietta, GA; Portland-Vancouver-Beaverton, OR-WA; and Dallas-Plano-Irving, TX. The areas with the fewest small-business
bankruptcy filings include: Springfield, MA; Lafayette, LA; Cedar Rapids, IA; Charleston, WV; and Hagerstown-Martinsburg, MD-WV.
BUSINESS BANKRUPTCY FILINGS
Source: CardData (www.carddata.com)
A new report reveals that commercial bankruptcies nearly doubled between March 2008 and March 2009. California, Texas and the Western part of the U.S. lead the list. The Equifax study found that the Chicago MSA increased to 199 bankruptcies from 67 in March 2008; Dallas increased to 162 from 73; Portland to 145 from 65 and Denver 157 from 58. Los Angeles, Riverside/San Bernardino and Sacramento metropolitan areas led the nation in small-business bankruptcy filings in March 2009
Metro areas with the fewest small-business bankruptcy filings remain scattered nationwide, with Charleston, WV, Columbus, GA, Norwich, CT, and the state of Hawaii. Equifax defines a small business as a commercial entity of less than 100 employees. There are more than 25 million small businesses in the USA.
While the nation’s President is reeling from the defeat in Iraq and dealing with a “lame duck” presidency with a Democratic Congress, he is still receiving some support in Congress today over his very controversial bankruptcy reform law, enacted one-year ago. The Senate Judiciary Subcommittee on Administrative Oversight and the Courts are holding a hearing on the “success” of the new law. The National Association of Consumer Bankruptcy Attorneys says the hearing is like “slapping some lipstick on the pig” of the 2005 bankruptcy reform law changes. Among those testifying: Steve Bartlett, president, Financial Services Roundtable; Clifford White, acting director, Executive Office for United States Trustee; and Professor Todd Zywicki, George Mason University School of Law. The NACBA notes that Bartlett represents banks and credit card companies; White is more interested in protecting big corporations from consumers; and Zywicki stood virtually alone among law professors in support of the legislation.
Congress is now considering a measure to raise the filing fee for chapter 7 bankruptcy filings by another $40, with the proposed fee increase coming on top of three previous fee increases that already had escalated bankruptcy filing costs by 90%. Yesterday the National Association of Consumer Bankruptcy Attorneys (NACBA) says even before this fourth increase was proposed, the federally mandated cost of bankruptcy filing already had jumped 90% to $399 since April 2005. Congress increased the cost of filing under the new bankruptcy law passed in April 2005, then further increased the fees in May 2005 under an emergency spending bill, and then did so for a third time in February 2006 in the “Budget Deficit Reduction Act.” The proposed fourth increase in fees would boost the federally required filing costs to $439, a 110% jump from the initial level of $209. The NACBA is encouraging all 3,300 of its attorney members to offer free consultation sessions with consumers in order to ensure that bankruptcy remains available and affordable to those in need.