About one in 12 families in the US do not have a bank account, and for the poor the rate is as high as one in four, according to the Federal Reserve.
As many as 28 million of the more than 300 million people in the US are forgoing traditional financial institutions because of mistrust, cultural and language barriers or a belief that by the time all the bills are paid there will be nothing left for an account.
That can be expensive and risky. People can run up big fees to cash checks, pay bills and meet their other financial needs. Walking around with large amounts of cash can make them a target for thieves.
The bankless are estimated to earn hundreds of billions of dollars a year in income. Seeing a business opportunity, banks are trying to draw in these potential customers. So, too, are check-cashing businesses and retailers.
Many people, however, still resist, preferring to remain in the financial shadows.
They tend to be minority -- Hispanic or blacks especially -- as well as low income and young.
According to the Federal Reserve, about one in 12 families -- 8.7 percent -- does not have a bank account.
The number is higher for the poorest -- nearly a quarter of families earning less than US$18,900 the US central bank said, citing 2004 data.
For some, like Rosa Alvarez, the financial choices can be bewildering.
"I don't understand about this bank stuff," said Alvarez, 54, who lives in Texas.
A nagging fear that she might make a mistake "if I don't keep up with it right or something" keeps her from opening an account. She had one once, briefly. But she had trouble keeping track of her balance. She thinks that when the account closed, she owed the bank US$12.
Carlos Maren, 25, a cook, is afraid that if he opens a bank account in the US, he will get hit with fees for not keeping in enough money or for taking out more money than he has.
"My uncle sometimes says that it's expensive ... because if you don't have money in the account, [the bank] is going to be charging you," Maren said.
He does his financial transactions at a check-cashing outlet in Washington. He said it is convenient and he likes knowing upfront what he will be charged to cash his paychecks, buy money orders and wire money to his native Mexico. He has a bank account there.
"It's not real expensive," Maren said.
Yet those charges can add up.
A Consumer Federation of America survey of check-cashing outlets, found that on average it cost US$24.45 to cash a US$1,002 government check last year. A blue-collar worker pays an average US$19.66 every week to cash a US$478.41 handwritten paper check.
Having a bank account can be expensive, too, if it is not managed wisely.
Failure to keep track of an account balance can incur a penalty of US$20 to US$35 each time a check is bounced or an account is overdrawn.
"It can be costly to be outside the banking system. The poor pay more," said John Caskey, economics professor at Swarthmore College.
"On the other hand, if all you did is take that low-income person, living paycheck to paycheck and moved them into the banking system and they are bouncing checks and incurring fees, you haven't done much and you may not have done them a favor," Caskey said.
The share of families without bank accounts decreased gradually from 1989 to 2001, then leveled off, the Fed said.
Banks have an economic interest in reeling in people outside the banking system -- 10 million to 28 million individuals who earn US$510 billion a year -- and turn them into customers who eventually may need loans to buy homes, cars and other items.
Banks are working through community groups to ease fears, build trust and to educate people about financial options. It is a challenge that can take years, bank officials say. Moreover, what may work in Houston does not necessarily prove fruitful in Fresno, California.
Federal Reserve research found that the most common reason families gave for not having checking accounts was that they did not write enough checks to make it worthwhile. Many people said they did not like dealing with banks.
Some -- regulators could not provide a percentage -- are in the country illegally. Without some proof of identification such as a driver's license or a passport, they cannot set up a bank account.
Over the years, technological innovations have spurred a range of products for people without bank accounts.
Some employers, not wanting to deal with the expense of paper checks, load employees' paychecks onto electronic cards that can be swiped at stores and restaurants or used to pay bills. These cards have federal protections, such as liability limits for unauthorized use, said Jean Ann Fox, director of consumer protection at the Consumer Federation of America.
Check-cashing outlets also sell electronic cards on which money from paychecks or a tax refund can be loaded. Fox said some of these cards can carry usage fees and may not have the same protections as bank-issued debit cards.
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