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The number of American households that were unbanked concluding year dropped to its lowest level since 2009, a dip due in part to people opening accounts to receive fiscal assistance during the pandemic, a new study says.

Roughly 4.5% of U.Southward. households – or 5.9 million – didn’t have a checking or savings account with a banking company or credit spousal relationship in 2021, a tape low, according to the Federal Deposit Insurance Corporation’due south most recent survey of unbanked and underbanked households.

Roughly 45% of households that received a stimulus payment, jobless benefits or other government assistance later the beginning of the pandemic in March, 2020 said those funds helped compel them to open an account, according to the biennial report which has been conducted since 2009.

“Condom and affordable bank accounts provide a way to bring more than Americans into the banking system and will continue to play an important role in advancing economic inclusion for all Americans,” FDIC interim chairman Martin J. Gruenberg said in a argument.

A lack of banking options delayed some households from getting federal payments aimed at helping the land weather the economical fallout from the COVID-nineteen health crunch.

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The FDIC initiated an educational campaign to get more Americans to open an account to enable the straight deposit of those funds. And banks such as Capital One and Ally Financial concluded  overdraft and other fees that take been a key barrier to some Americans accessing the banking system.

What does it mean to exist unbanked?

A household is deemed unbanked when no one in the home has an account with a bank or credit matrimony. That share of households has dropped by nearly half since 2009. And since 2011, when 8% of U.S. households were unbanked, the highest since the start of the survey, and the tape low reached in 2021, roughly half of the drop was due to a shift in the financial circumstances of American households the FDIC says.

Who are the underbanked?

Those who have a checking or savings account, but also use fiscal alternatives like check cashing services are considered underbanked. The underbanked represented 14% of U.South. households, or xviii.vii million, last year.

Why are people unbanked or underbanked?

Many of those who are unbanked say they can’t afford to take an account because of the fees for insufficient funds and overdrafts that are tacked on when business relationship balances fall short. Roughly 29% said fees or not having the required minimum balance were the principal reasons they didn’t have a checking or savings account, as compared to 38% who cited those obstacles in 2019.

Are some groups more likely to exist unbanked?

The numbers of the unbanked were greater amongst households that included those who were working historic period and disabled, lower income, included a unmarried mother, or were Black or Hispanic. Among white households for instance, ii% didn’t take a bank account last year as compared to 11% and 9% of their Black and Hispanic counterparts.

Meanwhile, virtually fifteen% of households with a working age member who had a inability were unbanked compared to almost 4% of other households. And  nearly 16% of households with a single mother were unbanked as compared to nearly 2% of married couples who lacked an account.

 “These gaps attest there’s nevertheless a lot of opportunity to expand participation beyond the population in the banking system,” Keith Ernst, Acquaintance Director of Consumer Research and Examination Analytics at the FDIC, said during a media call nigh the report.

Volition the number of unbanked rise if the U.Due south. has a recession?

Perhaps.

“During the last recession unbanked rates did indeed get upward,” Karyen Chu, main of the Banking Research Section at the Center for Financial Research, said during the telephone call.

Additionally, last year, homes where the head of household was out of work were nearly v times more than likely to non have a bank business relationship as compared to those where the household head was employed.

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“To the extent that income goes down … that has generally been associated with increases in unbanked rates,’’ Chu said.

Follow Charisse Jones on Twitter @charissejones