Georgetown Public Policy Review, February 18, 2020: Financial exclusion in American cities
Approximately 14.1 million adults in the United States did not have bank accounts in 2017. Access to mainstream banking — institutions insured by the Federal Deposit Insurance Corporation (FDIC) — can provide financial stability and economic mobility, while exclusion from it can lead to economic insecurity. The federal government routinely surveys American households to estimate the country’s rate of financial exclusion, defined as the proportion of households that do not use mainstream banking services. A recent survey revealed Black and Hispanic adults are unbanked at roughly four to five times the rates of White adults. I show race is the primary cause of financial exclusion and discuss policy solutions.
