WASHINGTON – Five Capitol-area credit unions will offer low- or no-fee savings and checking accounts as part of Washington’s new Bank on D.C. program.
The program was launched yesterday at CUNA’s Credit Union House, a block from the Capitol, by D.C. Mayor Adrian Fenty and representatives of participating credit unions, including HEW FCU, Agriculture FCU, District Government Employees FCU, Signal Financial FCU and Treasury Department FCU. Seven local banks also will participate.
Under the program, modeled after the successful Bank on San Francisco program and similar versions in 70 other cities, the credit unions have agreed to offer the low-cost accounts not only to new account holders, but to all of their current members.
About 37,000 D.C. households – maybe as many as 235,000 city residents – have no bank accounts, according to a study by the FDIC. Another 72,000 households are underbanked. The goal of Bank on D.C. is to add at least 10,000 to the rolls of credit union or bank customers.
To participate in Bank on D.C., banks and credit unions must offer companion checking and savings accounts that include an opening deposit of $25 or less, no monthly maintenance fees, no monthly minimum balance and free use of a check card and ATMs. Bank on D.C.’s financial partners will accept foreign identification cards to better serve the District’s foreign-born population, and will offer “Second Chance Accounts” for people with negative check-writing history.
Credit unions are a dominant force in area consumer finance with more than 60 credit unions located in the District of Columbia, with around 40% of D.C. residents owning accounts at a local credit union and 20% calling a credit union their primary financial institution. One in five auto loans in the area is done through a credit union. Credit unions experienced a 20% increase in mortgage originations in the DC area in 2009.
