Technological advances will not cut low-income people off from the banking system, Comptroller of the Currency Eugene A. Ludwig said Friday.

"This country has a long history of concern about access to the financial system for low- and moderate-income people," Mr. Ludwig said before an OCC-sponsored community development conference.

"That concern has survived a lot of evolution in the technology of banking already. I expect it to survive the next round of evolution as well."

Mr. Ludwig told an audience of community activists, bankers, and government officials that technological changes such as telephone banking can potentially increase access to bank services in low-income areas.

"Putting a brick and mortar branch in a low- and moderate-income neighborhood is expensive," Mr. Ludwig said. "But most people, even low- and moderate-income Americans, have telephones. And new technologies will allow people to bank, and indeed even obtain electronic money, wherever there is a telephone."

Advances in technology may also increase the amount of credit available by reducing the costs banks incur when making loans to low-income customers. Community development loans are typically small and thus more expensive to make than larger loans.

"Technology has a way of driving down unit costs," Mr. Ludwig said. "The costs of applications, lending documents, even disbursement can all be reduced through the use of technology, and that should benefit small loans."

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