Appealing to the underbanked has become an area of focus for many major institutions, with mixed success. Some large banks have opened branches in neighborhoods that have long been underserved but have difficulty attracting customers, perhaps because of a language barrier or distrust of large institutions.
Still, this market segment has great potential for financial institutions. In a 2011 study, the FDIC National Survey of Unbanked and Underbanked Households found that about 20 percent of households in the U.S. are underbanked, and about 8 percent are unbanked. It also found that more than 17 million adults do not have bank accounts.
Some major banks are unsure of how to go about appealing to the underbanked demographic. One bank, however, has found major success by bringing its services to the people and offering much more than just checking and savings accounts.
Fifth Third Bank started serving Cincinnati in a unique way in 2004. The company retrofitted two former city buses into Financial Empowerment Mobiles known as “eBuses.” The buses visit low- and moderate-income neighborhoods, the traditional homes of check-cashing storefronts and money-transfer agents who provide the most basic services.
The eBuses are equipped with work stations, computers and Internet access via satellite. The professionals from Fifth Third are on board to give customers financial education, one-on-one credit counseling and access to Fifth Third’s other products and services. The bank’s eBuses now also include job-hunting services, so customers can utilize training and job-search software to help them improve their resumes and prepare for interviews. Customers who use Fifth Third’s online banking services also can use the employment tools, which are provided by NextJob.
Fifth Third estimates that nearly 100,000 people in a growing number of cities have boarded the empowerment mobiles, receiving education and services they might not have had otherwise.