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There are as Many as 28 Million
"There are millions of Americans who do not have a bank account...A recent study has estimated that there are 28 million unbanked people in the U.S. and another 45 million underserved who lack adequate access to credit." (Martin J. Gruenberg, FDIC Alliance for Economic Inclusion Baltimore Forum, Speech, 5/1/07)
 
 
It is not safe to be un-banked: Families without accounts often don’t have a safe place to keep their money. Many carry it on their person or store it in the home. This can make them magnets for crime and especially vulnerable in the event of a disaster.
 
It hurts financially: Without a bank account, people often pay more to conduct their every day financial lives. It is harder to get well-priced car loans, credit cards, or mortgages—all financial tools needed to climb the economic ladder.
 
 
 
You Can Help The Unbanked Save Money And Stimulate The Economy

A worker who utilizes a Prepaid Debit Card could save almost $40,000 over their working lifetime.


"A full-time worker without a checking account could potentially save as much as $40,000 during his career by relying on a lower-cost checking account instead of check-cashing services."


  • The same worker could generate as much as $360,000 in wealth if these savings were instead invested in the stock market over their career. "Depending on types of checking accounts, residence, money management skills, and account stability, this same unbanked worker, assisted in transferring his savings into a low-cost exchange-traded fund with a discount broker, could generate as much as $360,000 in wealth over his 40-year career."


    This would be enough to pay for about 25 years of retirement, not accounting for the value of social security benefits. (Matt Fellowes and Mia Mabanta, "Banking on Wealth: America's New Retail Banking Infrastructure and Its Wealth-Building Potential," Brookings Institution Research Brief, 1/08)

     

     
    One in Five California Households Is Without a Checking Account.
    An additional 5.7 million households, or about 47 percent, were without a savings account. Altogether, there were about 1 million households who own neither a checking nor a savings account.
     
    African American and Latino households were also more likely to be unbanked than other households in California. It is estimated that 21 percent of African American households and 24 percent of Latino households lacked basic bank accounts in 2003, compared with only 4 percent of white households and 5 percent of "other race" households.
     
    Over one-quarter of African American and Latino households did not have a checking account, and approximately two-thirds of each group did not have a savings account. Together, African American and Latino households accounted for approximately 898,369 of the total unbanked. (Brookings Institution)
    California is home to two of the top three areas with the highest percentages of unbanked residents in the country. It is estimated that in the Fresno market, eleven percent of consumers are unbanked and in Los Angeles, nine percent are unbanked. (Scarborough Research, "Unbanked Consumers: Unique Opportunities for Financial Marketers," Report, 3/16/06)
    Over $8 billion Spent at Check Cashing Outlets
    Moderate- and lower-income households pay over $8 billion at check cashing outlets, payday lenders and pawnshops on basic financial services.
     
    "Those fees are collected from 48,082 non-bank establishments, which include approximately 26,000 businesses."
     
  • More than 20 million Americans now cash more than $60 billion in checks each year at check cashing businesses. "Overall, about 10 million households lack a transaction account (e.g., savings, checking, call account, money market) and about 12 million do not have a checking account (e.g., checking, checking money market)...This latter group of unbanked households represents the primary market for the $60 billion in checks cashed every year at nonbank establishments."
  • These businesses charge an average of $40 per payroll check to cash a check from typical unbanked households with full-time workers. "Among the households that lack a checking account, 52 percent include at least one full-time worker, costing the household an average of $40 per payroll check to use a non-bank check casher." (Matt Fellowes and Mia Mabanta, "Banking on Wealth: America's New Retail Banking Infrastructure and Its Wealth-Building Potential," Brookings Institution Research Brief, 1/08)
    • Excerts from the Office of the Governor "Bank on California" Fact Sheet