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Who are the Unbanked?. From JP Morgan. 22 million US households have no bank account at all and another 20 million are estimated to be underbanked (i.e., limited to no financial relationships).

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from jp morgan

Who are the Unbanked?

From JP Morgan

  • 22 million US households have no bank account at all and another 20 million are estimated to be underbanked (i.e., limited to no financial relationships)
  • 60 million Americans receive paper checks; over 40% of this population does not have a bank account and needs a direct deposit vehicle
  • Over $500 bn in payroll checks are issued annually to unbanked employees

Office of the Comptroller of the Currency

The OCC estimates that a typical consumer who monthly cashes two $400 checks and buys five money orders to pay bills would incur $270 in annual

costs not including any remittance fees. (June 2005)

South Carolina Council On Economic EducationMoor School of Business ● 1705 College Street ● Room 651● Columbia, SC 29208 ● (803) 777-8328 ● (803) 777-8328www.sceconomics.org

who are the unbanked 2001 federal reserve survey
Who are the Unbanked (2001 Federal Reserve Survey)
  • 9% of all US families- slightly less than 10 million families
  • Low to moderate incomes
  • Young and non white
    • 5% of non Hispanics whites vs. 22% of non whites and Hispanics as a group
    • Of the families in the lowest income quintile, 31% are unbanked
  • Why do they not have a checking account?
    • Don’t write enough checks to make it worthwhile- 28.6%
    • Do not like dealing with banks-22.6%
    • Don’t have enough money- 14%
    • Service charges are too high- 10.2%
    • Cannot manage or balance a checking account- 6.6%
    • Min. balance too high- 6.5%
    • Do not need or want a checking account- 5.4%
    • Credit problems-3.6%
    • No bank/no location/bad hours- 0.4%
    • Other- 2.1%
  • Over 52% of the unbanked families previously had a checking account, suggesting that something about their financial circumstances and/or behavior lead them to leave the financial mainstream
  • In a study of 480 workers done by the Center for Community Change and Community Financial Resources:
    • Median annual income- $15,600
    • Median monthly remittance- $293
    • Median monthly savings- $289
    • Close to half were unbanked even with proper credentials

South Carolina Council on Economic EducationMoore School of Business ● 1705 College Street ● Room 651● Columbia, SC 29208 ● (803) 777-8676 ● (803) 777-8328 faxwww.sceconomics.org

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South Carolina Council on Economic EducationMoore School of Business ● 1705 College Street ● Room 651● Columbia, SC 29208 ● (803) 777-8676 ● (803) 777-8328 faxwww.sceconomics.org

Over 25 million households are unbanked