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Due to the pandemic, banks are offering new accounts for the unbanked

25 October 2020
1 min.
Due to the pandemic, banks are offering new accounts for the unbanked

Banks started offering a new type of account

A huge number of consumers are unable to cash a cheque or visit an ATM because they are not customers of ordinary banks.

Consumers are not the owners of bank accounts and the reason for this is the lack of sufficient money for the minimum account.

Banks offer a more availability type of account, which allows the consumer to do all transactions with or without a minimum fee. All such accounts ensure a low monthly fee for their use. However, the bank does not charge an overdraft fee.

In addition, banks are being asked to consider a proposal that would increase access to banking services. Many banks already offer such accounts, and the minimum deposit to open an account is no more than $25.

Thanks to a study by a bank, no one in the house has access to a current account for about 7.1 million homes or American households.

The economy has also been showing a low level of "non-banking" consumers in recent years. The level was 6.5% in the previous survey for 2017.

Federal Deposit Insurance Corporation closely monitors and studies consumer use of the banking system. In its latest survey, the corporation had 33,000 household responses.

The so-called "non-bank" numbers could increase significantly this year. Also, an economic crisis due to a pandemic may force large numbers of people out of traditional bank accounts.

FDIC surveys show that the unemployed are four times more likely to fall into the non-banking category, according to Karyen Chu, Head of Banking Research at the FDIC Centre for Financial Research.

According to Federal Deposit Insurance surveys, there is a high probability that unemployed people will fall into the non-banking category.

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