Colorado's 'unbanked' rate 5.8% to 7.4%, FDIC says

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Heather Draper

Reporter- Denver Business Journal

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Colorado ranks about in the middle of U.S. states for the percentage of people who are "unbanked" — without bank accounts — at 5.8 to 7.4 percent.

That's according to results of a Federal Deposit Insurance Corp. (FDIC) survey released Wednesday.

Meanwhile, Colorado's "underbanked" rate is in a lower range than most states, at 17.1 to 19 percent, the 64-page FDIC report said.

The survey, done in 2013, doesn't break down results by state beyond U.S. maps that showed ranges of unbanked and underbanked rates, as well as mentions of specific states on the extreme ends of the spectrum.

"Unbanked" in this report refers to households that don't have any account at an insured institution. "Underbanked" refers to households that have an account, but have also used financial services and products from non-bank, alternative financial services providers (like payday lenders) in the prior 12 months.

Among regions, the southern United States has the highest rates of unbanked and underbanked residents, at 9.2 percent and 23.5 percent, respectively.

Among states, Mississippi has the highest rate of unbanked at 14.6 percent and Alaska the lowest at 1.9 percent.

Nationally, the study found that the proportion of unbanked households declined from 8.2 percent in 2011 to 7.7 percent in 2013, while the share of underbanked households remained essentially unchanged at 20 percent.

The FDIC attributes the drop in the unbanked to "improving economic conditions and the changing demographic composition of households."

By race or ethnicity, the survey found the rate of unbanked is highest among black Americans at 20.5 percent, and lowest among Asian Americans at 2.2 percent. The rate of unbanked is also high among Hispanics, at 17.9 percent, and American Indians, at 16.9 percent.

Heather Draper covers banking, finance, law and sports business for the Denver Business Journal and writes for the "Finance Etc." blog. Phone: 303-803-9230.