Only 9M have no bank accounts

7% of households, about 9 million, are unbanked, FDIC says

Record low number of unbanked households

The percentage of U.S. households containing not one person with a checking or savings account fell to a record low of 7% last year, according to a report issued Thursday by the Federal Deposit Insurance Corp.

The percentage of so-called unbanked households declined by 0.7 percentage points from 2013 levels. That amounts to about 9 million U.S. households without a checking or saving account. Additionally, 19.9% of U.S. households are “underbanked,” or rely on financial services outside of the banking system such as money orders, payday loans and check cashing or pawn shops, the FDIC found. The percentage of underbanked households was roughly the same as in 2013.

That means more than a quarter of households are unbanked or underbanked.

About half of the drop in the percentage of unbanked households is due to improving economic conditions, the FDIC says. Households with lower incomes, less education, disabled members as well as those that are younger or African American or Hispanic are more likely to be underbanked or unbanked. However, the FDIC points out the rate of unbanked people “declined substantially” among households with $15,000 or less annual income, younger households and African American or Hispanic households in 2015 from 2013 levels. The study is conducted every two years.

Members of unbanked households have multiple reasons for not having an account. The reason cited more than any other was they “do not have enough money to keep in an account,” the FDIC says. This reason was cited by 57% of the unbanked households.

Privacy and security reasons were also named by many members of unbanked households as well as issues with fees. Comments like “don’t trust banks,” or “avoiding a bank gives more privacy” was often made by unbanked individuals. “Bank account fees are too high” was blamed by 9.4% of unbanked respondents. More than half of unbanked households thought banks were not interested at all to serve them.

Despite the concerns, most households didn’t have nearly as much skepticism. More than three-quarters of households polled said banks were either “very interested” or “somewhat interested” in serving them.