According to Alonzo J. Primus, CPA, MBA, former CEO and President of First Bank of Delaware, credit cards have traditionally been the main tool most Americans have utilized to finance their short-term needs for cash and credit.
Many consumers, however, have fallen into a less desirable class of consumer risk as defined by lenders due to borrowing at higher rates than they could afford in recent years.
The banking industry has stopped lending to all but the highest level of credit-worthy Americans, and for the average person this means that credit is not available when they most need it.
This lack of access to credit is forcing more consumers to rely heavily upon Payday Advance Lenders, Car Title Lenders, and Pawn Shops, all of whom may charge anywhere from 200%-400% interest on the money they lend, and whose short-term solutions will not necessarily meet consumers' long-term financial needs.
also states that the refusal of the banks to lend to consumers they view as risky is one of the primary reasons why this nation remains mired in a recession.
"Now is the time for consumers to look to the private sector," said Primus
"With the banking industry severely restricting lending activities, it's up to companies such as Fidelity One
to innovate and create products that will truly serve the credit-challenged market."
Due to the recession and the high number of home foreclosures in recent years, many Americans now have only one primary asset: their automobile, said Primus
With this in mind, Fidelity One
created the Auto Secured Credit Card and Revolving Line of Credit, which operates like a secured credit card, but uses a vehicle as security rather than cash on deposit.
This product will allow millions of Americans who would not normally qualify for credit to obtain a secured credit card or line of credit.
In addition, Cash Advances can be made on the equity of the borrower's vehicle at a much lower cost than other types of loans, such as Payday Advance Loans and Car Title Loans; Fidelity One's rates and minimum monthly payment are typically half those of most other loans in the industry.
"This revolving line of credit financial product, secured by an auto, is one of the most creative consumer financial products to be introduced in this country since the recession hit," said Primus
"The banking system has failed the millions of financially challenged consumers out there by refusing to lend when people need help the most; but with innovative lenders such as Fidelity One
creating new ways of providing credit at a lower cost, the national economy-and the American people-are finally going to have the chance to get back on the road to recovery."
Alonzo J. Primus, CPA, MBA.
Mr. Primus has over 18 years of banking experience and was the CEO and President of First Bank of Delaware for over 5 years.
has expertise in a number of areas, including commercial lending, card and consumer products, payment processing, money service business services, accounting and finance, human resources, and bank management.