5% of Households Still Unbanked Despite Outreach

New Poll Suggests Little Change Since 2019

Woman worrying over paper at table
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The share of households without a savings or checking account doesn’t appear to have changed much in the last two years, a new survey shows, despite efforts by many banks to remove common barriers like minimum balances, account and overdraft fees, and a lack of branches in lower-income neighborhoods.

Key Takeaways

  • Five percent of households lack a checking or savings account, according to a new survey by Morning Consult—showing the unbanked population may not have declined much despite recent efforts to improve access.
  • Lacking a bank account can require someone to pay extra fees for simple transactions like check cashing and limit their ability to build a credit history.
  • Compared to those with bank accounts, unbanked adults are more likely to be women, have lower incomes, and be Black, Hispanic or from another non-White race or ethnicity, Morning Consult’s data shows.

Ten percent of U.S. adults do not have a savings or checking account at a bank or credit union and qualify as “unbanked,” data from a new poll by Morning Consult showed, and of those, half—or 5% of adults—report that no one in their household has an account. This roughly matches findings from a June 2019 study by the Federal Deposit Insurance Corp., which showed 5.4% of households in the U.S.—the equivalent of 7.1 million—were unbanked. The limited change may be a sign banks still aren’t doing enough to attract this group.

"They're issues that won't be solved in just a year," said Charlotte Principato, a financial services analyst at Morning Consult and author of a recent report on the poll, which was taken July 29-Aug. 1 of this year and modeled after the FDIC’s.

While the FDIC’s data shows the unbanked population steadily declining from as high as 8.2% in 2009 (the year the FDIC started tracking it), efforts to remove obstacles have increased since the most recent government data was collected in 2019, including through the FDIC’s own publicity campaign, #GetBanked, and the nonprofit Cities for Financial Empowerment Fund’s Bank On initiative, both of which emphasized the importance of reaching financially vulnerable families during the pandemic.

Women More Likely To Be Unbanked

Lacking a bank account can be costly not only in terms of extra fees but because it can prevent someone from building the credit score they need to get an affordable loan or even any loan at all, Principato said. Compared to those with bank accounts, unbanked adults are more likely to be women, have an income under $50,000, be a member of the Generation Z or Millennial generation, and be Black, Hispanic or from another non-White race or ethnicity, Morning Consult’s data shows.

Some 119 bank accounts offered at institutions around the country now meet standards set through Bank On, up from 20 as of October 2018. Wells Fargo, for example, has started an initiative to offer accounts with no overdraft fees and more low-cost loans, as well as open more branches in areas with a high concentration of people who are unbanked. PNC Bank has a fleet of trucks it calls mobile branches to bring services directly to underbanked communities.

For a person without a bank account, a simple transaction like cashing a paycheck may require a visit to a check cashing business that would take a cut for itself in the form of fees. But long-standing obstacles like not having enough money to qualify for an account often prevent people from signing up, according to Principato.

Some Don't Trust Banks

There’s also a sizable proportion of unbanked people who don’t believe banks have their best interests at heart, with 45% in Morning Consult’s survey saying they wouldn’t trust the financial services industry to do what is right and 62% saying they don’t believe banks or credit unions care about their financial health.

Indeed, the data suggests many unbanked are drawing on past experience with banks too—76% of the unbanked said they have had either a checking or savings account at a bank at some point. One-third said they’ve had one in the last year. 

While convenient locations and lack of fees and minimum balances were among the most commonly cited features a bank would need to get their business, according to the survey, being unbanked could be a matter of choice for some, Principato said

Twenty-one percent of unbanked adults surveyed said none of the common financial goals listed in the survey—including improving credit, eliminating debt, saving for retirement, or purchasing a home—were important to them. It was the second most commonly chosen answer (respondents could choose three) behind “creating an emergency fund” at 24%.

Morning Consult polled 4,400 adults in the U.S.

Have a question, comment, or story to share? You can reach Rob at ranthes@thebalance.com.