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The company that is standardly referred to as competitor is CashAmerica, (I think that's the name), but they are a consolidator of pawn shops -- not a fullservice, financial services company for the cash economy. Cash America has a check-cashing machine, but according to Ace's IR (add grain salt and stir), they haven't noticed a drop-off in volume in those markets where both they and Cash AAmerica are operating. They view the machine as something which expands the market -- I'm not entirely sure that I buy that.

However, Cash AMerica took a big hit recently precisely because of expenses associated with the check-cashing machine. Ace, meanwhile, has products that go far beyond mere check-cashing. A great one is the pay-day loan. Although this has an extremely high default rate (17%) this is more than made up for by obscene APR you get when you figure loan fees into the equation. Ace had projected 20% default, so they're pleased with the lower number, adn I think this will be reflected in a surprise for the year and the quarter.

Finally, this is exactly the sort of business the banks have been turning away, and the recent mergers will probably mean that the big banks will continue to eschew. Also, a product like the payday loan is misunderstood strictly as a high risk loan, when the effective APR is much higher than anything a bank can legally charge (Recent fortune article gave a theoretical example in which APR was something like 400%). Certainly, if ACE show this biz can be profitable, competitors will come, but not before ACE has a nice head start.
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