[briandear]

A tangent, but why can’t a “poor” person with $10,000 use banks? I am unaware of any income requirement to open a bank account. In many states, even illegal aliens can’t open bank accounts. I’m not sure I understand why the poor can’t use banks. I was poor once with credit in the low 500s and I’ve always had bank accounts.

[scott_s]

They can. Why they are less likely to is, I believe, an area of active study. A 2017 study by the Federal Deposit Insurance Corporation cites the two main reasons as trust and fees (page 4): https://www.fdic.gov/householdsurvey/2017/2017execsumm.pdf

[astrange]

Most physical banks charge you fees for having a checking account, fees for overdrafting, etc. If you don't pay one of those you can be banned from banking by Chexsystems.

[perl4ever]

Do you really think most banks charge monthly fees for having a checking account?

I just checked and the bank I had an account with for many years requires $50 deposited to open an account and no minimum balance or monthly fee, includes free checks and debit card.

The credit union I use now has no minimum balance, no monthly fee, and no fee for writing checks. You have to deposit $1 for a share of the credit union, which you get back if you close your account.

My impression is these days they are making over 2% on deposits absolutely risk free, so they better not charge anything.

[astrange]

Yes, any big bank with a lot of branches absolutely charges you. It's very easy to get deals like online banks (more reliable than credit unions BTW) but those don't provide services like depositing cash some people need.

[perl4ever]

I wasn't talking about online banks, which I know nothing about. I was talking about ordinary everyday banks and credit unions, which allow you to withdraw money from shared networks[1] of ATMs nationwide for free. Like, this is a thing, you don't have to have $20,000 in a Bank of America account to get free checking and you don't need a nationwide branded ATM/branch network. You don't have to have direct deposit either. Or be white. I've literally been in banks and have seen with my own eyes how it works.

[1]https://www.allpointnetwork.com/locator.aspx

[astrange]

Requiring $50 in the account or $10 a month deposits to avoid the fee is still too much. Large overdrafts are also too much. The thing about poor people is they don’t have any money.

[perl4ever]

The bank and the credit union I mentioned in my previous post do not require that you keep $50 in an account or regularly deposit anything.

Like I said, my credit union requires a deposit of one (1) dollar, which you get back when you close your account.

[throwaway2048]

Most banks absolutely charge monthly fees for checking accounts.

[perl4ever]

I imagine any bank that charges a monthly fee would tell you that.

[throwaway2048]

Why does not using a bank mean your money is fine to steal from you?

[scott_s]

I don't believe that is what briandear was trying to imply. I read it as an honest question to understand why people are unbanked or underbanked.