About Bank On
The Bank On movement is designed to improve the financial stability of America’s unbanked and underbanked by making safe, low-cost transaction accounts accessible to all. An estimated 4.5% of U.S. households—or approximately 5.9 million—were unbanked in 2021, according to a Federal Deposit Insurance Corp. (FDIC) report. This means these households did not have checking or savings accounts at a traditional bank or credit union. The most common reasons that respondents surveyed for the FDIC report cited for being unbanked included the following:See the 2021 FDIC National Survey of Unbanked and Underbanked Households (PDF).
- They did not have enough money for the minimum balance in an account.
- They did not trust banks.
- They said avoiding banks affords more privacy.
- Bank fees were too high or unpredictable for them.
An additional 22 million households are underbanked based on calculations by CFE using FDIC data. These households have a bank account, but many times they rely on alternative financial services such as money orders, check cashing services and payday loans rather than traditional loans and credit cards to manage their finances.
The Bank On movement’s purpose is to improve the financial stability of unbanked and underbanked individuals and families by making safe, low-cost transaction accounts available and accessible to all. A way in which the movement reaches its target markets is by professionalizing, or building a formal structure, for banking access efforts for financial institutions and their customers. Paramount to the professionalization of such efforts are high-quality data showing the takeup, or engagement with, and usage of Bank On-certified accounts.
The CFE Fund provides a public certification seal for transactional consumer accounts offered by financial institutions that meet Bank On National Account Standards. Local coalitions and government leaders can rely on these certifications when choosing to highlight accounts available to local residents and when choosing partners for banking access programs. Additionally, financial institutions market their product-specific national certification seal to highlight that their accounts meet these standards. The CFE Fund also promotes Bank On-certified accounts by including them in Bank On marketing materials and in communications with local Bank On coalitions, as well as in its own program investments.
Bank On-certified accounts help financial institutions reach unbanked and underbanked customers by bringing them into the financial mainstream and starting a new banking relationship. This benefits consumers who need accounts with low or minimum required balances, including those who have left the mainstream banking system because of overdraft issues, those looking for accounts with flexible account screening, or those who were turned off by high or unpredictable fees. Bank On-certified accounts seek to provide a safe, affordable and functional banking experience that allows consumers to build or rebuild a relationship with a mainstream financial institution. Financial institutions offering Bank On-certified accounts are also poised to attract people entering the banking world for the first time, including young people and students. Such customers tend to build long-term banking relationships.
In addition, products certified as meeting the Bank On National Account Standards (see the Bank On Data Metrics) support Community Reinvestment Act (CRA) service test examinations. Recent guidance for CRA questions and answers (PDF) highlights the availability of low-cost deposit accounts, the extent to which they reduce costs, and the degree to which services are tailored to meet the needs of low- to moderate-income (LMI) individuals.
The Bank On National Account Standards offer guidance for financial institutions to prioritize account offerings that highlight their commitment to:
- Meeting consumers’ and communities’ needs
- Connecting with banking access opportunities or programs
- Expanding their customer base
- Meeting regulatory requirements for community reinvestment