By PYMNTS Intelligence
Click here to read the entire report.
Money back from the Treasury Department in this year’s tax filing season isn’t likely to help the nearly 70% of Americans who live paycheck to paycheck, a trend increasingly driven by financial necessity, not choice of lifestyle.
Financial strain is persistent across the United States, and the annual tax season—and refunds that come with it—aren’t likely to provide much relief. Roughly two-thirds of American consumers continue to live paycheck to paycheck in early 2026, with little sustained improvement. Within this group, roughly 40%–45% report comfortably paying their monthly bills, while 20%–25% consistently struggle, indicating that a large share of households have little financial slack amid inflation, higher living costs and tariffs. At the same time, the composition of paycheck-to-paycheck living has shifted. Over time, people living this way due to financial necessity have overtaken those living paycheck to paycheck by choice, suggesting that economic pressure—rather than lifestyle preferences—is increasingly driving financial vulnerability.
In theory, tax refunds and one-time government payments could play outsized roles in bolstering household budgets. But paycheck-to-paycheck consumers, especially those struggling to pay bills, are less likely to receive refunds. When they do, they overwhelmingly use the money to cover everyday expenses or repay debt. By contrast, financially stable consumers receive tax refunds more consistently and are far more likely to save or invest them, reinforcing existing gaps in financial resilience.
These are just some of the findings detailed in “Tax Refund Season Reveals the Reality of Paycheck-to-Paycheck America,” the newest installment of the PYMNTS Intelligence exclusive series New Reality Check: The Paycheck-to-Paycheck Report. This edition examines who receives tax refunds, how they use them and how preferences differ between tax refunds and one-time government payments—especially across paycheck-to-paycheck personas and financial lifestyles. It draws on insights from a survey of 2,432 U.S. adult consumers conducted from Jan. 15, 2026, to Jan. 29, 2026.
- Paycheck-to-Paycheck Living
- Tax Refunds and Financial Stability
- One-Time Government Payments and Household Responses
- Read more
- Methodology
Click here to continue reading.
By Maria Volkova, American Banker
Click here to read the entire article.
The Federal Reserve’s proposed “skinny” master account for fintechs and other nontraditional financial companies may move quickly towards finalization at the central bank, but experts say implementation will very likely be stalled by legal challenges from the banking industry or the challenger institutions.
Todd Baker, senior fellow at the Richman Center for Business, Law & Public Policy at Columbia University, said lawsuits from either banking or fintech groups are foreseeable, especially in light of the Supreme Court’s 2024 decision to overturn Chevron deference, which reduced the level of judicial deference historically afforded to federal agencies.
“The question is who sues and why, and are they successful in getting a stay on implementation of the regulation until full review by the court,” Baker said. “The way the law has changed is the court doesn’t care what the Fed thinks anymore. The court is going to look at the words of the statute, which don’t provide a lot of clarity.
“It’s very unlikely that [the proposal] will be actually put into effect right away, even if the regulation becomes final,” Baker concluded.
Graham Steele, a former assistant secretary for financial institutions at the Treasury Department and academic fellow at the Rock Center for Corporate Governance at Stanford Law echoed similar sentiments, noting the Fed will face criticism or litigation from stakeholders regardless of how it proceeds.
Click here to continue reading.
By Andrew Lepczyk, CreditUnions.com
Click here to read the entire article.
The “K-shaped economy” is a buzzword that has defined the post-COVID economic landscape. The term describes an environment where those who are high earners and own assets continue to do very well, whereas those on the lower rungs of the economy do worse and worse. In this way, their diverging paths create a “K shape.”
The K-shape is symbolized by different socioeconomic classes’ ability to withstand the headwinds facing the U.S. economy. For example, with inflation, higher income households tend to own assets that are inflation-resistant. Meanwhile, for lower income Americans, inflation in the cost of everyday items eats up more of their budget.
According to a 2023 report from the Federal Reserve, the more money a consumer has, the less stress they are likely to experience as a result of inflation. These diverging impacts and stress levels are present throughout the economy.
A History Of The K-Shaped Economy
For many decades following World War II, economic growth increased at roughly parallel rates for wealthy Americans and lower-income Americans. However, during the 1980s, the haves began to outpace the have-nots. Following the COVID-19 pandemic and the subsequent surge in inflation, the two halves of America began to uncouple further.
The pandemic disproportionately impacted service-oriented workers who could not work remotely, resulting in furloughs and layoffs shortly after the onset of COVID-19. Federal economic relief checks temporarily abated this impact, but then inflation disproportionately ate away at the budgets of lower-income Americans.
Although the economy on average has caught up, many Americans have been left behind, living paycheck to paycheck and relying on credit cards to make ends meet.
Click here to continue reading.
By Maxwell Earp-Thomas, A.J. S. Dhaliwal, James G. Gatto, Sheppard, Mullin, Richter & Hampton LLP – AI Law and Policy; Published in National Law Review
Click here to read the entire article.
AI-driven “agentic commerce” is no longer theoretical. Today’s AI assistants can already search for products, compare options, populate shopping carts, check out, initiate payment, and make returns, all on behalf of a person who may never see the website on which a transaction is executed on their behalf. In some cases, users move all the way through checkout using stored payment credentials.
While many systems still operate within guardrails (e.g., requiring human user confirmation or operating under preset limits), the direction is clear: AI agents are beginning to autonomously initiate and execute financial transactions on consumers’ behalf. As these capabilities continue to expand, the line between human- and machine-initiated transactions continues to blur, and legal and regulatory implications come into sharper focus.
What Forms of Agentic Commerce Exist Today?
Today’s implementations of agentic commerce generally fall into two practical tiers. The most common is assisted e-commerce, where AI tools support product discovery, comparison, and checkout within a chat box or embedded interface, but the user still provides explicit approval before any payment is executed. A step closer to autonomy is semi-agentic systems, in which the AI is permitted to complete transactions with minimal or no additional user input once predefined conditions are met.
These systems include features such as price-tracking with automatic purchase triggers, where the user sets parameters in advance and the AI executes the transaction when those parameters are satisfied. Autonomous AI agents that manage the full shopping lifecycle on a user’s behalf are growing rapidly. Often a user gives an agent “goals” and the agent identifies and executes transactions to implement those goals without a contemporaneous human decision that traditional payments laws assume will exist.
Agentic Commerce vs. Compliance
The shift to an increasingly automated shopping experience reframes the regulatory conversation. When an AI assistant pays a bill or clicks “buy”, central compliance questions will revolve around authentication, authorization, fraud, and who bears responsibility when an AI’s actions do not align with a consumer’s wishes or when rogue agents are deployed to execute bogus transactions. For regulators, banks, fintechs, and merchants, existing concepts of consent, liability, and consumer protection strain when transactions are initiated by software rather than people. Current regulatory frameworks concentrate on authorization, fraud controls, and dispute resolution, all of which were designed for human-initiated transactions.
Click here to continue reading.
By Dave Kovaleski, Financial Regulation News
The U.S. House of Representatives passed a bill that would clarify the process of determining whether a financial firm is systemically important to the financial system.
Specifically, the legislation requires FSOC to work with a company and its primary regulator to mitigate risks associated with its business activities before designating the company as a Systemically Important Financial Institution (SIFI).
The Council is charged by statute with identifying risks to the financial stability of the United States; promoting market discipline; and responding to emerging threats to the stability of the U.S. financial system.
“Since FSOC was created, lawmakers and administration officials have debated the process of determining if a firm poses a risk to our financial system,” Rep. Bill Foster’s (D-IL), the bill’s sponsor. said. “Past efforts by FSOC to designate firms’ risk levels have been controversial or short-lived. This bipartisan legislation strengthens FSOC’s ability to identify and address emerging threats to financial stability and consumers by promoting a more consistent, accountable, and effective approach to oversight.”
The bill now heads to the U.S. Senate for consideration.
By Leslie Picker and Ritika Shah, CNBC
Click here to read the entire article.
At America’s oldest bank, 134 new workers don’t sleep or take sick days. They don’t even have names.
They’re what BNY calls “digital employees.” They work side by side with humans. They have unique roles and are evaluated by how well they do them. Some of their jobs were done by people last year.
“The digital employee works 24/7, which is obviously very different to our human counterparts,” said Rachel Lewis, who oversees nine digital employees in addition to thousands of humans as head of payment operations for BNY. “It’s really focused on very specific repetitive tasks that allow our human employees to do much more human, intense, interesting-type roles.”
BNY employs 48,100 humans, down from about 53,400 in 2023, according to a recent earnings presentation. CFO Dermot McDonogh was asked on the firm’s fourth-quarter analyst call last month what the 134 digital employees mean for cost savings at the firm.
“Our head count has trended down a little bit, but that’s not really anything to do with AI yet,” McDonogh said. “We talk about, internally, AI is unlocking capacity. We don’t think about it in the narrow definition of efficiency. It’s all about growing with clients, increasing revenues and optimizing the potential for our employees.”
Across Wall Street, analysts and investors are starting to ask more questions about how the industry’s expenses on AI will translate into higher efficiencies and greater returns. BNY spent $3.8 billion on technology in 2025, or about 19% of its revenue. That’s the highest proportion among its large-bank peers, according to data collated by CNBC.
Click here to continue reading.
By Amber Jackson, Andrew Warren; Financial Health Network
Click here to read the entire article.
New Financial Health Pulse® data show that trust in financial institutions is uneven, with substantial racial and ethnic disparities across key dimensions of banking.
Consumers Are Hesitant To Trust Financial Institutions
Consumer trust in financial institutions is central to financial inclusion, the stability of the financial system, and consumer well-being. Trust is the foundation of daily financial decisions: each time a person opens a bank account, deposits their paycheck, or seeks financial advice, they place trust in a financial institution to safeguard their money and act fairly.
When that trust is lacking, consumers may disengage from the financial system entirely. Among the 5.6 million unbanked households in the U.S. in 2023, lack of trust is the second most-cited reason for not having a bank account (trailing only behind cost).1 Without a certain level of trust in financial institutions, people may choose to keep part or all of their money outside of the system. At a broader level, a widespread lack of confidence in financial institutions can undermine industry stability and, in extreme cases, contribute to bank runs and collapse of financial systems.
Trust also shapes how consumers perceive institutions’ intentions and effectiveness. Research shows that when institutional trust is low, people are more likely to question an institution’s fairness or lose confidence in its decisions.2,3,4 Previous Financial Health Network research finds that customers are more loyal and engaged when they believe their primary financial institution helps them improve their financial health.5 In short, a consumer’s trust influences not only whether they participate in the financial system, but also how deeply and sustainably they do so.
But what does it mean to trust a bank or credit union? When consumers report that they trust or do not trust financial institutions, they may have different financial services or underlying dimensions of trust in mind. To better understand these nuances, we added new questions to the 2025 Financial Health Pulse® survey to capture consumer opinions on various aspects of financial institutions, including confidence in deposit safety, trust in financial advice, transparency around costs and fees, and whether institutions genuinely want to help consumers improve their finances.
Click here to continue reading.
By Sergiu Gatlan, Bleeping Computer
Click here to read the entire article.
Microsoft plans to introduce a call reporting feature in Teams by mid-March, allowing users to flag suspicious or unwanted calls as potential scams or phishing attempts.
The new “Report a Call” function will be enabled by default, but administrators who want to disable the new security feature can toggle off “Report a Call” in the Teams Admin Center under “Calling settings.”
The feature will be available in Teams call history for one-to-one calls on Windows, Mac, and web, and it will let users click “More options” next to any call and select “Report a Call” to submit a report.
As Microsoft explained, when users flag a call, limited metadata (including timestamps, duration, caller ID information, and participant Teams IDs) will be shared with the organization and Microsoft.
“Currently, users have no simple way to report suspicious calls, leaving organizations without visibility into these threats and without clear guidance on how users should respond,” Microsoft said in a message center update.
“Reports share limited call metadata with organizations and Microsoft, viewable in Microsoft Defender portal or Teams Admin Center. The feature is enabled by default but can be disabled by admins.”
The feature will roll out to Targeted Release customers in mid-March, with completion expected by late March, and it will reach general availability worldwide by late April.
Security teams with Defender for Office 365 (Plan 1 or Plan 2) or Defender XDR licenses can view detailed reported instances in the Microsoft Defender portal, while organizations without Defender licenses will be able to access basic submission data in Teams Admin Center under Protection Reports.
Click here to continue reading.
By Melina Druga, Financial Regulation News
Less than half of Americans, 47 percent, have sufficient liquidity or access to funds to cover a $1,000 emergency expense, according to a survey-based report conducted by Bankrate and its polling partners.
When asked how they would pay for an emergency expense of $1,000 or more, 33 percent of survey participants said they would go into debt through a credit card, a personal loan or borrowing from family or friends; 30 percent would use their savings; 17 percent would rely on their regular income or cash flow, and 20 percent would reduce spending to pay for it or take a different approach.
“Most folks in America live paycheck-to-paycheck,” Mark Hamrick, Bankrate senior economic analyst, said. “This either results in, or coincides with, a lack of liquidity and lack of ability to achieve success with other key financial goals such as paying down debt or saving for emergencies and retirement.”
Other survey findings include:
- When asked what is causing them to save less for emergencies, 54 percent of respondents said inflation followed by changing income/unemployment, 26 percent, and recent interest rate cuts, 17 percent.
- If they were to lose their primary source of income tomorrow, 43 percent said they would be “very worried about covering living expenses.”
By Dave Kovaleski, Financial Regulation News
Click here to read the entire article.
U.S. Sens. Catherine Cortez Masto (D-NV) and Kevin Cramer (R-ND) introduced a bill that would give credit unions more flexibility when lending for non-primary loans.
The Expanding Access to Lending Options Act would permit federally chartered credit unions to permit loan maturity periods for up to 20 years.
Except for primary residences, federally chartered credit unions are not permitted to issue loans for a period longer than 15 years. However, banks and most state-chartered credit unions are not subjected to the same limitation.
“Credit unions provide essential services to communities across the Silver State, particularly in rural and underserved areas,” Cortez Masto said. “My bipartisan bill would provide a commonsense, simple fix that helps people finance their dreams.”
Nevada has two federally chartered credit unions that would be impacted by this bill — the Great Basin Federal Credit Union and the Elko Federal Credit Union.
“Increasing the loan maturity limit for federally chartered credit unions will greatly help the Elko Federal Credit Union,” Todd Sorenson, president and CEO of Elko Federal Credit Union, said. “When interest rates are low, consumers shop around: they want the certainty of a lower rate for a longer term. It’s in this environment that federal credit unions are less competitive. Many customers seeking loans at our credit union have pursued other loan options when we communicate the maturity date limitation.”
Click here to continue reading.
By Amy Howe SCOTUS Blog
Click here to read the entire article.
Updated at 3:45 p.m. on Jan. 21
The Supreme Court on Wednesday appeared likely to leave Lisa Cook, a member of the Federal Reserve’s Board of Governors, on the job while her challenge to President Donald Trump’s attempt to fire her continues.
Although the Trump administration contends that the president acted within the law, a majority of the justices seemed ready to reject the government’s request to allow him to remove her, even if it was not clear whether the justices would send the case back to the lower courts or instead go ahead and rule that Trump does not have a good reason to fire Cook.
Wednesday’s arguments in Trump v. Cook implicated two related issues – the president’s power to fire the heads of multi-member, independent agencies and his ongoing frustration with the actions (or lack thereof) of the Federal Reserve. Since Trump took office last year, the court – on its interim docket – has allowed him to remove members of the National Labor Relations Board, Consumer Product Safety Commission, and the Merit Systems Protection Board. The justices also heard arguments in December in the case of Rebecca Slaughter, a member of the Federal Trade Commission whom Trump fired in March. They are expected to decide by summer whether a federal law that bars him from removing members of the FTC except in cases of “inefficiency, neglect of duty, or malfeasance in office” violates the constitutional separation of powers.
Trump has also been sharply critical of the Fed and its chair, Jerome Powell, since he was sworn in for a second term last year, particularly for its reluctance to lower interest rates. The Fed eventually lowered rates at meetings this fall.
Powell disclosed earlier this month that he is under investigation by Jeanine Pirro, the U.S. attorney for the District of Columbia, for alleged irregularities in the $2.5 billion renovation of the Fed’s headquarters and Powell’s statements to Congress about the renovation. The White House has said that Trump did not direct Pirro to investigate Powell, who attended Wednesday’s argument.
Cook was first appointed to the Fed in 2022; then-President Joe Biden reappointed her to serve a new 14-year term on the board in 2023. Under the Federal Reserve Act, Trump can only fire Cook “for cause” – a term that the law does not define.
Click here to continue reading.
By Eric Steinhoff, Scienaptic AI; Published in CUInsight
Click here to read the entire article.
The answer isn’t complicated. The Honda holds its value more predictably, the monthly payments are more affordable across a broader range of incomes, default rates are lower, and recoveries are stronger when something goes wrong.
Yet at many credit unions, both loans are priced identically if the borrower has a 720 credit score. In some cases, the used Honda is even priced higher.
The same logic applies elsewhere in the portfolio. A 2019 pickup truck and a 2019 sedan frequently receive the same pricing treatment, even though pickup truck values have swung dramatically in recent years while sedan prices have remained comparatively stable.
These outcomes aren’t the result of poor underwriting or a misunderstanding of the variables that impact risk. They stem from a deeper issue: most institutions are still using static pricing frameworks to operate in highly dynamic markets.
The hidden cost of static pricing
Across the auto lending industry, a significant share of loans are mispriced, not because credit decisions are wrong, but because pricing systems lag reality. Quarterly rate sheets are being used to navigate markets that change weekly or even daily.
Vehicle values respond to forces well outside traditional credit models: supply chain disruptions, manufacturer incentives, fuel prices, regional demand shifts, and macroeconomic conditions. When pricing assumptions are built in January but loans are booked in June, institutions are effectively flying blind.