AMP News Finance & Banking

Online banking works to bring in previously ‘unbanked’

The unbanked population in Arkansas sits above the national average of 7 percent but dropped to 9.7 percent last year, the lowest ever, according to a new report from the Federal Deposit Insurance Corp.

There are a multitude of factors that play into the decrease, but indicators point to the ease of online banking as app technology increases. While the number of unbanked Arkansans sits under 10 percent, the number of what the FDIC calls “underbanked” sits at a much higher 22.6 percent for 2015.

Graphics within the report show that in 2013, 84.4 percent of people used their bank teller when interacting with the accounts. That number dropped to 75.5 percent in 2015 and shows an increase in online banking from 46.9 percent to 55.4 percent. The advent of mobile banking has also extended the reach of the banks to bring in previously unbanked customers with a 24.2 to 27.8 percentage increase.

According to the report, Arkansans that were tagged as “unbanked” showed no sort of emergency savings, while nationally 20 percent of households report keeping a savings fund. This translates into 38.1 percent having no credit and 6.6 percent are left to use only non-bank credit which is can be unregulated with higher interest rates that hurt the customer. Nationally, 28.8 percent of the population remain unbanked, no credit, households that just over 4 percent of rely on non-bank credit.

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