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The number of American households that were unbanked last year dropped to its lowest level since 2009, a dip due in function to people opening accounts to receive financial assistance during the pandemic, a new written report says.

Roughly iv.5% of U.S. households – or 5.ix million – didn’t have a checking or savings account with a bank or credit union in 2021, a record low, according to the Federal Deposit Insurance Corporation’s most recent survey of unbanked and underbanked households.

Roughly 45% of households that received a stimulus payment, jobless benefits or other government assistance after the start of the pandemic in March, 2020 said those funds helped compel them to open an business relationship, co-ordinate to the biennial written report which has been conducted since 2009.

“Safe and affordable bank accounts provide a way to bring more than Americans into the banking system and volition continue to play an important role in advancing economic inclusion for all Americans,” FDIC acting chairman Martin J. Gruenberg said in a argument.

A lack of banking options delayed some households from getting federal payments aimed at helping the country weather the economic fallout from the COVID-19 health crisis.

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The FDIC initiated an educational campaign to get more than Americans to open up an account to enable the straight eolith of those funds. And banks such equally Capital One and Ally Financial concluded  overdraft and other fees that accept been a key barrier to some Americans accessing the banking system.

What does it mean to exist unbanked?

A household is deemed unbanked when no ane in the abode has an account with a bank or credit union. That share of households has dropped past nearly half since 2009. And since 2011, when 8% of U.Southward. households were unbanked, the highest since the get-go of the survey, and the tape low reached in 2021, roughly half of the drib was due to a shift in the financial circumstances of American households the FDIC says.

Who are the underbanked?

Those who accept a checking or savings account, but as well use fiscal alternatives like check cashing services are considered underbanked. The underbanked represented 14% of U.S. households, or million, last yr.

Why are people unbanked or underbanked?

Many of those who are unbanked say they can’t afford to take an account because of the fees for insufficient funds and overdrafts that are tacked on when account balances autumn short. Roughly 29% said fees or not having the required minimum balance were the primary reasons they didn’t have a checking or savings account, as compared to 38% who cited those obstacles in 2019.

Are some groups more likely to exist unbanked?

The numbers of the unbanked were greater amidst households that included those who were working age and disabled, lower income, included a unmarried mother, or were Black or Hispanic. Among white households for example, 2% didn’t have a banking concern account last year every bit compared to 11% and 9% of their Blackness and Hispanic counterparts.

Meanwhile, nearly 15% of households with a working age member who had a inability were unbanked compared to most 4% of other households. And  virtually 16% of households with a single female parent were unbanked as compared to virtually 2% of married couples who lacked an account.

 “These gaps adjure in that location’s yet a lot of opportunity to expand participation across the population in the banking system,” Keith Ernst, Associate Director of Consumer Enquiry and Exam Analytics at the FDIC, said during a media call most the study.

Will the number of unbanked rise if the U.South. has a recession?


“During the last recession unbanked rates did indeed go up,” Karyen Chu, chief of the Cyberbanking Research Section at the Center for Financial Research, said during the call.

Additionally, terminal yr, homes where the head of household was out of work were well-nigh v times more likely to not accept a bank account as compared to those where the household head was employed.

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“To the extent that income goes down … that has more often than not been associated with increases in unbanked rates,’’ Chu said.

Follow Charisse Jones on Twitter @charissejones