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10.20.16

FDIC Study: Unbanked Rate Drops; Prepaid, Mobile on Rise

The number of households without bank accounts fell to its lowest level since the FDIC first began conducting its biannual survey in 2009. Seven percent of U.S. households were unbanked last year, according to the FDIC’s 2015 National Survey of Unbanked and Underbanked Households, released Oct. 20. That percentage dropped from 7.7 percent in 2013 and 8.2 percent in 2011.

Another key finding of the survey was the rapid growth in prepaid card usage. Between 2013 and 2015, the proportion of all U.S. households that had used a prepaid card in the past 12 months increased from 7.9 percent to 9.8 percent. The growth in prepaid use occurred broadly across socioeconomic and demographic groups—although prepaid cards remained more likely to be used by certain groups, including lower-income and unbanked households and younger households, the study found.

Among the unbanked, the most common reason for not having a bank account was not having enough money to keep in an account, cited as a factor by 57.4 percent of unbanked respondents. Privacy and security concerns were next, with 56.5 percent listing such concerns as a factor. Account fees ranked next, with 51.7 percent of unbanked respondents saying fees were too high and/or unpredictable.

Meanwhile, the survey found that the rate of underbanked households has inched down as well—though not as significantly as the unbanked decline. The underbanked rate was 19.9 percent in 2015, compared with 20.0 percent in 2013 and 20.1 percent in 2011. The FDIC survey defines underbanked as households that have a bank account, but look outside the traditional banking system to meet transaction or credit needs.

Use of online and mobile banking also increased substantially from 2013 to 2015. The survey found that 36.9 percent of respondents reported online banking as their primary method for accessing a bank account, compared to 28.2 percent who relied on bank tellers. Usage of smartphones to perform banking activities surged as well, with 9.5 percent of households relying on mobile as their primary banking method of banking, up sharply from 5.7 percent in 2013.

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