WASHINGTON - A new study by the FDIC has found that more than a million American households lost access to basic banking services such as savings accounts last year.
The FDIC survey said it found that in total some 30-million U.S. households have little or no access to such services, with poor, minority and immigrant families hit especially hard.
The survey found that 25.6% of U.S. households either lack bank accounts or use payday loans, check-cashing services and other costly alternatives to traditional banks. The survey is part of a broader effort by the FDIC to bring the "unbanked" into the financial mainstream.
The report is part of an FDIC effort to bring the so-called "unbanked" into the financial mainstream.
"By better understanding this group — who they are and their reasons for being unbanked or underbanked — we will be better positioned to help them take that first step," said FDIC Chairman Sheila Bair.
The survey defined "unbanked consumers" as those households that report no member has a checking or savings account. "Underbanked" households have bank accounts but still rely on costly, lightly regulated services like payday loans, check-cashing services and pawn shops.
The survey found that black, Hispanic and native American families are more likely to fall into these categories. Seventy-one percent of unbanked households earn less than $30,000 a year, it found.
Of the 1.3 million households that stopped having bank accounts in 2008, more than 31% said they closed them because of overdraft fees, service charges or high minimum balance rules. A slightly larger group, 34.1%, said they did not have enough money to need an account, the report says.
Other findings:
- 54% of black households, 44.5% of American Indian/Alaskan households and 43.3 % of Hispanic households have limited access to banking.
- Households in the South are more likely to be unbanked or underbanked.
- About 28% of households headed by unmarried people are underbanked. For households with married couples, the number is 15.4%.
