Bank on D.C. Opens for Lower-Income Populations

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The Washington Business Journal
By: Melissa Castro
April 28, 2010

District Mayor Adrian Fenty today announced the formal launch of "Bank on D.C.," a public-private partnership aimed at giving the city's "underbanked" populations easy access to a checking account and financial literacy.
The program, a partnership between the D.C. government, regional financial institutions and community-based organizations, was first unveiled in early February . Valerie Santos, deputy mayor for planning and economic development, called the program an effort to keep residents away from "financial parasites," meaning check-cashing outlets that charge high interest rates.

About 37,000 D.C. households - maybe as many as 235,000 city residents - have no bank accounts, according to a study by the Federal Deposit Insurance Corp.

More than 50 cities already offer Bank On accounts, marketed with the slogan "Everyone's Welcome."

To participate, banks and credit unions must offer companion checking and savings accounts that include an opening deposit of $25 or less, no monthly maintenance fees, no monthly minimum balance and free use of a check card and ATMs.

Five area credit unions, including Bank on D.C.'s platinum sponsor, HEW Federal Credit Union, are offering the low-cost accounts to all current members and to new customers. Other local credit unions supporting Bank on D.C. include Agriculture Federal Credit Union, District Government Employees Federal Credit Union, Signal Financial Federal Credit Union and Treasury Department Federal Credit Union.

The Maryland and District of Columbia Credit Union Association, which represents 173 local credit unions, called credit unions a "dominant force" behind the Bank on D.C. program. The association even used the opportunity to take a swipe at banks, claiming that credit unions "have been an open outlet to consumers for all types of loans, as banks shut off lending during the economic crisis they caused."

At least two local banks, PNC Bank and Bank of Georgetown, are part of the program.

The partnership has a website, www.bankondcblog.com, to help with outreach and to build financial literacy.

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This page contains a single entry by Ernest Roberts published on April 29, 2010 3:19 PM.

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