The Cost Structure of Consumer Finance Companies and Its Implications for Interest Rates: Evidence from the Federal Reserve Board's 2015 Survey of Finance Companies

Lisa Chen and Gregory E. Elliehausen

No 2020-08-12, FEDS Notes from Board of Governors of the Federal Reserve System (U.S.)

Abstract: Interest includes compensation not only for forbearance (forgoing current income for future income) and risk bearing but also compensation for expenses incurred to originate, service, and collect loans. The latter expenses are largely fixed, not varying much with the amount of credit.

Date: 2020-08-12
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfn:2020-08-12

DOI: 10.17016/2380-7172.2610

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