National Banking Initiative for the Unbanked!
The Cities for Financial Empowerment Fund hosted its Bank On 2.0 Conference, “Building A National Platform for Local Banking Access Programs” in Washington, D.C. on November 6, 2014. The conference brought together influential leaders from city government, the financial services sector, non-profit service organizations, consumer advocates and federal regulatory agencies to discuss the ways in which they can work together to expand access to affordable banking services. The conference also featured remarks from the Chairman of the Federal Deposit Insurance Corporation (FDIC), Martin Gruenberg and the Director of the Consumer Financial Protection Bureau (CFPB), Richard Cordray.
The day-long conference focused on how to support local banking access initiatives, exploring how banks and credit unions can make the business case for reaching unbanked consumers, how new technologies can connect consumers and how city leaders can play a leading role facilitating the solution through local programming.
“In many ways, access to an account at a federally insured financial institution is a pathway to full participation in our economy. Yet millions of households in our country lack access”, said FDIC Chairman Martin Gruenberg. “The Bank On movement is an important initiative to address that issue.”
Last week, the FDIC released their 2013 National Survey of Unbanked and Underbanked Households, the most comprehensive survey on the subject in the country. The findings showed that 7.7 percent of U.S. households or 9.6 million households were unbanked, with another 20 percent or 24.8 million households still relying on nonbank alternative financial services, like check cashers or payday lenders. Interestingly, slightly less than half of unbanked households had previously been banked.
“At the Consumer Financial Protection Bureau, we are committed to providing access to financial services for the unbanked or underbanked,” said CFPB Director Richard Cordray in remarks at today’s conference. “Bank On coalitions have successfully brought together key stakeholders to provide thousands of consumers with opportunities to access checking account products. Through our continued work together, we can continue to expand access to financial services for the consumers most in need.”
The Bank On movement began as a pilot initiative nine years ago, quickly expanding to nearly 100 cities across the country. To date, local governments have successfully connected more than half a million residents to safe and affordable banking services, through a variety of partnerships between local, regional, and national banks and credit unions. The CFE Fund’s Bank On 2.0 initiative builds on the grassroots success of these programs to create a national approach and infrastructure to facilitate local efforts to serve the tens of millions of people still living outside the financial mainstream.
“Local and federal policymakers, the banking community, and non-profit organizations have learned real lessons when it comes to the terrible and ongoing price that communities and the nation pay when millions of people are financially unstable,” said Jonathan Mintz, President and Chief Executive Officer, Cities for Financial Empowerment Fund. “We are seeing mayors take a leading role in bringing the unbanked into the financial mainstream, and look forward to assisting those efforts through our integrated, national approach.”
The conference followed the first meeting of the Bank On 2.0 Advisory Board. The group is comprised of senior leaders from government, non-profit organizations and financial institutions tasked with informing the CFE Fund’s Bank On 2.0 initiative.
The Bank On 2.0 initiative is sponsored by JP Morgan Chase and Co., American Express, Bank of America, Capital One, Citi Foundation, The MetLife Foundation and VISA.
About the Cities for Financial Empowerment Fund
The CFE Fund supports municipal efforts to improve the financial stability of households by leveraging opportunities unique to local government. By translating cutting edge experience with large scale programs, research, and policy in cities of all sizes, the CFE Fund assists mayors and other local leaders to identify, develop, fund, implement, and research pilots and programs that help families build assets and make the most of their financial resources. For more information, please visit www.cfefund.org.