Underbanked

Westamerica Bancorp. will close its branch in Upper Lake, Calif., after a failed effort to find another financial institution to take over the branch.

Borrowers are faced with two terrible choices: take out another exploitative loan because of the shortfall created by the first, or face a range of catastrophic consequences associated with defaulting.

Avant, an online lending platform that focuses on borrowers with marred credit, announced an agreement Wednesday to raise $325 million in equity financing from blue-chip investors.

A recap of the informed opinions (and the discussions they generated) on BankThink this week, including how postal banking could help low-income people in the U.S. and the continuing debate over interchange fees.

American banks long ago deserted their most impoverished communities. Today, post offices are uniquely well positioned to serve the underbanked population — and perhaps reinvigorate a culture of saving in the process.

Contrary to the CFPB’s paternalistic claims, most payday loan borrowers are aware that it may take them more than two weeks to repay the credit they take out.

Families that use state-issued EBT cards often face ATM fees that eat away at their already-meager incomes. Banks should waive those fees in order to ensure that all public assistance dollars go toward household needs.

Prepaid cards appeal to a growing percentage of the population like millennials and other 21st century consumers who want to manage their money without being tied down to bank locations.

It's been nearly a century since reformers and lenders agreed on 36% as a small-dollar loan ceiling. Inflation has since swelled production costs, and lending under this cap is no longer profitable. The result: fewer options for consumers.

At this year's EMERGE Forum in Austin, Texas, the Financial Solutions Lab — a $30 million, five-year initiative managed by the Center for Financial Services innovation with founding partner JPMorgan Chase — revealed the winners of a recent competition for apps that tackle consumers' cash flow challenges. The nine winning organizations, chosen from 298 applicants and 14 finalists, received a combined $3 million, along with mentorship, networking, peer learning and national partnership opportunities. The following is a look at their solutions to the problems of the working poor and others ill-served by traditional financial products.

JPMorgan Chase will overhaul customer screening procedures to let more low-income consumers open checking and savings accounts under an agreement announced Tuesday with New York Attorney General Eric Schneiderman.

Two community banks that focus on underbanked and low-income populations, City First Bank of D.C. and Southern Bancorp in Arkadelphia, Ark., have joined an international group that promotes socially and environmentally responsible development.

Austin Capital Bank, a $71.4 million-asset institution based in Texas, will originate loans for a new online consumer lending platform called Self Lender, the two companies announced.

Payday lending activity increased in California last year, but the size of loans and fees charged both declined, according to a new report from California's banking regulator.

Almost two-dozen banks in New York City do not appear to offer or widely advertise basic checking accounts, although state law requires it, the New York City Comptroller said Friday.

Alternative data used to score "credit invisibles" may do more harm than good. That's because in areas like employment and insurance, no credit score is often better than a bad one.

The U.S. Postal Service strongly criticized a recommendation from its inspector general that the agency expand remittances, check cashing and other banking services. The services would be potentially riskier and costlier than the impression left by IG David Williams' report, the USPS said.

Most banks are interchangeable in the eyes of the average consumer. But a recent survey finds that mission-oriented banks distinguish themselves with greater employee diversity and a stronger commitment to lending in low- and moderate-income communities.

A specialized Wells Fargo branch in Des Moines and the nonprofit Digital Finance Institute are part of a small but growing movement to improve access to financial services for emigres who have escaped war or persecution.

A small Austin, Texas, bank, formerly called Libertad, had to abandon its initial plan to target unbanked Hispanics. But it has made the most of its second chance by finding a niche in lending to real estate investors. Now it's looking to diversify.