Getting Back To That Community Bank Lending Perspective

FDIC kicks off its two-year pilot project to identify best practices in affordable small-dollar loan programs. Thirty banks, headquartered in 17 states and ranging in assets size from $20 Million to $10 Billion will participate.

Key characteristics of a small loan program under this program include:

• Loans under $1,000
• Installment payments
• Interest rate less than 36%
• Low or no origination fees
• No prepayment penalties
• May include an automatic savings component
• Streamlined applications
• Financial education

Here's a link to the list of participating banks: http://www.fdic.gov/news/news/press/2008/pr08010.html

(ag) Feb. 19, 2008, in FDIC/Lending Issues