(1 March 2010 – USA) A study by the Department of Consumer Affairs’ (DCA), Office of Financial Empowerment (OFE) indicated that 13 percent of New York households are lacking a bank or credit union account.The study revealed that the 825,000 under-banked adults are handling their financial activities, such as bill payments and cashing payroll cheques, by using cheque cashers and other alternative financial service provides.
The figure is alarmingly high for the city considering the national average of under-banked households is 7.7 percent, according to the Citywide Financial Services Study.
The building blocks toward financial empowerment includes having an account at a bank or credit union, stated DCA Commissioner Jonathan Mintz, who presented the research at a forum hosted by the Center for New York City Affairs at The New School in New York City.
Mr Mintz said the findings are disturbing, signalling a big problem.
New Yorkers are more likely than people in the rest of the country to go without a bank account. The 825,000-plus unbanked New Yorkers represent a population segment bigger than the population of Miami and Pittsburgh combined, Mr Mintz noted.
Mr Mintz added that the sheer volume of people who depend on alternative financial services providers represents an enormous market, and a huge opportunity for banks and credit unions.