Amidst Regulation, Unbanked Population Grows

Navigator Edition: September 2012
By: Josh Gilbert and Emma Causey

The FDIC recently released its 2011 report from the second National Survey of Unbanked and Underbanked Households. Based on its survey of over 45,000 households, the FDIC found that the percentage of households that are unbanked has increased roughly 0.6% since 2009.

These research findings are consistent with First Annapolis’ analysis of the retail banking market after the final Durbin Amendment rules were published. At that time we predicted that 1.7% of debit customers would eventually leave the formal banking system over the next five years as a result of regulation-induced account re-pricing. More specifically, our analysis suggested that FIs subject to debit interchange regulation would need to add or increase account fees while increasing minimum balance requirements. Given that these factors are frequent deterrents to opening and maintaining a bank account, it is not surprising that the unbanked population is on the rise. We expect the unbanked percentage to steadily increase over the coming years as financial institutions continue to re-price deposit accounts in response to the low interest rate environment and regulatory pressures on historical revenue sources.

Figure 1: Percent of U.S. Households that are Unbanked
Source: FDIC National Survey of Unbanked and Underbanked Households, 2009 and 2011

For more information, please contact Josh Gilbert, Principal specializing in Deposit Access,; or Emma Causey, Senior Analyst specializing in Deposit Access,

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