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Bank On Movement's Progress: Financial Inclusion for Millions

The latest report from the Bank On National Data Hub, provided by the Federal Reserve Bank of St. Louis in collaboration with the Cities for Financial Empowerment Fund, offers compelling insights into the impact of Bank On certified accounts. These accounts have proven to be a critical tool for millions of unbanked and underbanked households, enhancing their access to the financial mainstream. As of now, more than 14 million Bank On accounts are active, with 4.8 million new accounts opened in 2024 alone, marking a significant 27% growth from the previous year.

Embracing Financial Security

The primary aim of the Bank On movement is to provide safe and affordable banking options to those previously excluded from financial services. Findings from the report reveal that Bank On certified accounts have been successfully established in 91% of U.S. zip codes, with a staggering 84% of new account holders having no previous banking relationship.

This year’s data emphasizes that not only are more Americans opening new accounts, but they are also actively using them. On average, a Bank On account holder conducted 33.4 debit transactions monthly, with payments exceeding $13 billion processed each month. This active utilization has resulted in a notable drop in account closures, which fell by over 28% compared to the previous year, demonstrating a strong commitment among users to maintain these accounts.

Transaction Patterns and Growth

The insights extend beyond just opening accounts; the data speaks volumes about user engagement. Bank On account holders made an average of eight deposits a month, with total deposits in 2024 surpassing $260 billion. Direct deposit usage was prevalent, with nearly 40% of account holders opting for this feature, boosting their average monthly account balance to $1,273.

Moreover, the shift towards digital banking is evident, with over half of account holders utilizing their certified accounts for peer-to-peer transactions—this surged from 31.8 million transactions in 2023 to 61.4 million in 2024, highlighting the movement towards modern banking practices.

Coalition for Change

Jonathan Mintz, President and CEO of the Cities for Financial Empowerment Fund, expressed optimism about the movement, stating, “More than a decade into the Bank On movement, financial institutions, local government leaders, and federal regulators continue to collaborate to ensure that safe and affordable banking is accessible to everyone.” He noted that the national unbanked rate has been halved since its peak, showcasing the successful reach of this initiative.

Lisa Locke, Community Development Advisor at the Federal Reserve Bank of St. Louis, reflected on the importance of these findings, emphasizing that access to banking services is essential for economic stability and wealth building, which are pivotal in today’s economy.

The partnership between the Federal Reserve and the Cities for Financial Empowerment Fund through the Bank On National Data Hub underlines an ongoing commitment to sharing metrics demonstrating the positive impact of certified accounts across various demographics.

Future of Financial Empowerment

The CFE Fund aims to continue supporting cities and municipalities to enhance financial stability, engaging in innovative programs designed to maximize asset-building opportunities for local families. Currently, the fund operates in over 150 locations and has allocated more than $75 million to empower local communities through effective financial programs.

As the Bank On movement advances, the focus will remain on connecting consumers to certified accounts that meet stringent safety standards. With over 500 certified accounts available, the movement represents over two-thirds of the national deposit market share. This widespread certification ensures that consumers have access to banking products without unexpected fees, enabling them to fully benefit from their financial resources.

For more information about the Bank On movement and its resources, visit www.joinbankon.org.

As we look ahead, the continued integration of unbanked and underbanked Americans into the financial system will undoubtedly foster greater economic resilience and stability across the nation.