Another City Looking After Its Low-Income Residents? Bank On It

Add Evansville, Indiana to the list of communities adopting services for the unbanked. City leaders, in collaboration with a number of financial institutions, have set up a program called “Bank on Evansville.” Similar to the “Bank on San Francisco” program currently up-and-running, this program will attempt to keep unbanked families from paying excessive check-cashing fees, which can total nearly $900 annually for some, according to the city.

Though details have yet to be finalized on the program (set to launch in 2009), many banks and credit unions are already offering accounts that require no minimum balance, as well as second-chance accounts for those who have lost one.

To be eligible for these accounts, the city is offering and requiring those who enroll to take a financial education course. Details of the course have yet to be finalized.

Partners include: Old National Bank, the Federal Reserve Bank of St. Louis, the United Way of Southwestern Indiana, Integra Bank, Fifth Third Bank, the Bank of Evansville, Farmers State Bank, Evansville Commerce Bank, Heritage Federal Credit Union and the Evansville Teachers Federal Credit Union.

These programs provide much-needed financial education to those who need it most while providing many with a first-time opportunity to save and build up their asset base.

According to the Census bureau, 14% of U.S.-born white families have no checking or savings account, compared to 34% of U.S.-born Hispanic families and 46% of black families. Evansville officials estimate that 6,000 residents are currently unbanked, out of a population of approximately 110,000– or 5.4%. Although surveys vary, that number seems to be lower than the national average.