Unbanked households decline slightly in Greater Washington

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Those families with no access to traditional banking services declined between 2011 and 2013.

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Mark Holan

Staff Reporter- Washington Business Journal

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The number of unbanked households in Greater Washington declined slightly to 4.3 percent in 2013 from 4.6 in 2011, but nearly one in five households here now use a mix of traditional and nontraditional financial services, up from just below 17 percent three years ago.

The percentage of unbanked households here is below the 7.7 percent nationwide, while the region's 19.8 percent underbanked rate is in line with the country's 20 percent rate.

The data, released Wednesday, comes from the latest installment of a nationwide survey conducted every other year by the Federal Deposit Insurance Corporation since 2009. The survey reveals a range of details about how people engage or skirt the financial system, which can impact on the overall economy.

The roughly 93 million Americans who are unbanked or underbanked is a significant market opportunity for banks.

Unbanked households are those with no traditional banking relationships. Underbanked households are those that have at least one regular account but also use alternative financial services such as money orders, payday loans, pawn shops or auto title loans.

This year's FDIC survey also contains new data points about how people with traditional banking relationships access their accounts, with nearly two-thirds preferring branch tellers and online service. Underbanked households are more likely to use mobile devices to access their accounts than fully banked households by 29.2 percent to 21.7 percent, respectively.

In Washington, the rates of unbanked Hispanics (12.3 percent) and African-American households (9.7 percent) were far higher than non-Hispanic whites (1 percent), but still below national rates by race.

Mark Holan covers the economy and money — banking, finance, private equity, corporate accountability and professional services.