More than one-quarter of U.S. families either have no bank account or rarely use banking services, according to a recent survey conducted by the U.S. Census Bureau for the Federal Deposit Insurance Corporation (FDIC).
In its National Survey of Unbanked and Underbanked Households, the FDIC reports that 7.7 percent of U.S. households - about 9 million households -- have no bank accounts at all, while an additional 17.9 percent of U.S. households - about 21 million households - are "underbanked."
"Underbanked" households may have a bank account, but have used payday loans, nonbank money orders, nonbank check-cashing services, rent-to-own agreements, or pawn shops at least once or twice a year or refund anticipation loans at least once in the past five years.
The survey showed that households with annual income under $30,000 account for at least 71 percent of unbanked households, while households with an income between $30,000 and $50,000 are almost as likely as lower-income households to be underbanked.
The proportion of U.S. households that are unbanked varies considerably across racial and ethnic groups with certain racial and ethnic groups being more likely to be unbanked than the population as a whole. Minorities more likely to be unbanked include blacks (21.7 percent of black households), Hispanics (19.3 percent), and American Indian/Alaskans (15.6 percent). Racial groups less likely to be unbanked are Asians (3.5 percent) and whites (3.3 percent).
"Access to an account at a federally insured institution provides households with an important first step toward achieving financial security - the opportunity to conduct basic financial transactions, save for emergency and long-term security needs, and access credit on affordable terms," stated Sheila Bair, Chairman of the FDIC in a press release.
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