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Home Behind The Apply Button Episode 8 – “The Next 90 Days: Brick and Mortar”

Behind The Apply Button Episode 8 – “The Next 90 Days: Brick and Mortar”

Behind The Apply Button Episode 8 – “The Next 90 Days: Brick and Mortar” March 19, 20201 Comment

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This episode is incredibly hard for me to write. The world’s economy has shattered right in front of our eyes. The most vulnerable of our society can’t buy basic necessities like milk and egg, it’s truly a black swan event that no one expected.

How long?

People ask me how long will this last. We don’t have to do any hard math to know that this will last the next days. When COVID19 first exploded in Wuhan City, China in Dec 2019, the virus ran rampant for 90 days leading up to late Feb 2020.

The United States experienced a surge in Coronavirus infection around the time when China’s infection rate tapered off. 90 days from Feb 2020 will put us in June/July 2020 time frame.

How bad?

60% of Americans have less than $1,000 in savings. Most are living from paycheck to paycheck. There’s a high correlation between those that have less and the type of jobs (hourly, blue-collar) and a deficient credit score in the eyes of mainstream banks and credit card companies.

Close to 40% of Americans have a 650 FICO score or lower, often deemed as subprime or near-prime. Shun by credit card companies and the like. It’s already difficult for many of our Americans to access credit. And that’s before the virus hit.

Brick and mortar.

Many of our fellow Americans frequent neighborhood check cashing or payday loan stores to get emergency cash. Some study shows that people frequent these stores on a monthly basis to cover emergency needs such as rent, car, and employment-related issues.

There are thousands of these stores spanning coast to coast, servicing millions of Americans when big banks and financial institutions refuse to service them. This network of branches holds the communities of America together when no one else is stepping up to the plate.

The iron curtain.

Many states, counties and major metropolitans have all issued “stay and shelter” order. It’s recommended that no one should be outside between the hours of 5 am to 8 pm. Making it impossible for people to visit these stores after a busy day or work.

The entire retail sector has shut down. Millions of Americans can’t work because of school closures. Not everyone has the opportunity to work from home in front of a computer. Some of the States have seen unemployment claims increased by 100% over the past week.

We are heading into an unprecedented recession.

90 days.

All shall pass. The next 90 days will be a test for all sectors of our society and every fabric of our humanity. My brick and mortar operator friends, we can help you to get an online presence up and running in 30 days to keep on servicing your community. Just like Starbucks mobile order, apply (order) online, and swing by to pick up their checks.

Call to FinTech entrepreneurs.

Now it’s time to leverage our technology and experience to contribute. Let the rebuilding begin.

Tim

One comment

  1. Tim Li your analysis couldn’t have been summarized any better. My first thought was also that of the many million of Americans who rely on these loan products and how they’ll get by month to month. I found that 21% of our typical portfolio of borrowers will be unemployed by Month’s end. Now is the time for the Brick and Mortar players to catapult their helping hand to the online market.

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