Electronic Payments Nixed Windsor Locks Jobs

The Federal Reserve’s move to close its check processing facility in Windsor Locks at the end of the month stems from a broad shift in the way Americans pay their bills.

People are putting away their checkbooks and paying electronically, and debit cards are the fastest growing form of payment for young adults. Debit card use for retail payments has shown double-digit annual growth since 2002.

According to a study commissioned by Visa, only 41 percent of 18-24 year olds use personal checks. And most people in that age category (63 percent) regularly carry a payment card but rarely carry cash (60 percent).

“We’re seeing a worldwide secular trend away from paper-based payments that began 50 years ago and has accelerated in the past 10 years,” said Kim Axelrod of Visa Inc. “The convenience, speed and security of electronic payments is helping drive this migration as more and more consumers realize the benefits of paying electronically with their credit, debit or prepaid card instead of checks, cash or coins.”

In addition, employers’ growing use of direct deposit and the widespread acceptance of online bill-paying have also eroded the popularity of check writing.

The trend away from check writing will cost 94 workers in Windsor Locks their jobs as the Fed consolidates their work in its check processing facility in Philadelphia.

A 3.5 Percent Mortgage

When Liberty Bank offered 30-year fixed-rate mortgages in Wethersfield at the eye-poppingly low rate of 3.5 percent recently, local residents lined up outside the bank’s new branch hours before opening. Some spent the night waiting on the line to file an application.

The bank ran the one-day promotion Sept. 13 to advertise the opening of the branch and to boost local real estate sales.

Liberty earmarked $3.5 million for the promotion, which appeared to have the desired effect.

In the week before to the promotion, the number of homes that were under contract to be sold in Wethersfield shot up 110 percent to 42, an increase from the typical average of 20, said Robert Steele, director of consumer credit risk at Liberty Bank.

“We are trying to give the real estate market a boost,” Steele said. “People have been on the fence as to whether or not they should purchase a home right now. With this promotion we were trying to convince people that they should.”

Steele said Liberty received 24 mortgage applications from potential home buyers, who were required to come in with signed purchase contracts to be considered for the special mortgage finance offer. About 15 of those loan applicants were likely to be approved, Steele said.

Liberty isn’t the only bank that has unveiled aggressive discounting plans to attract new customers.

Citizens Bank has extended its employee-discount program to the public.

That means the bank’s customers are eligible to receive a half-percentage point discount on new home equity installment loans and lines of credit, and $250 off closing costs on a mortgage.

The offer will continue to run through Oct. 10.

Capital Management Partners

Farmington Capital Partners, a financial advisory and merchant banking firm with offices in Hartford and Charleston, S.C., has named Tim Morris as managing partner.

Morris, a former senior vice president of the property casualty division at Travelers, is based in South Carolina. He has worked in the financial services industry for more than 35 years in positions at National Capital Advisors, Citigroup, Travelers and The Hartford.

Morris has a broad range of knowledge that cuts across underwriting, brokerage, bank insurance, and mergers and acquisitions, said John Clinton a managing partner at the firm.

Clinton said he hopes to use Morris’s strong operational insurance management experience to complement the company’s already strong expertise on insurance capital markets.

Farmington Capital Partners serves entrepreneurs and investors in middle-market sized transactions in the insurance industry.

Greg Bordonaro is a Hartford Business Journal staff writer.