Mississippi’s non-bankers pay for inconvenience

Published 12:00 am Sunday, December 6, 2009

It’s one of those statistics that makes a person wonder.

Federal banking regulators say 16.4 percent of Mississippi households — 184,000 — don’t have a bank account or access to any banking services.

That’s a lot. Indeed, it’s more than double the national average of 7.7 percent, according to the Federal Deposit Insurance Corp.

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And there’s more. The FDIC says 282,000 households, or 25.2 percent, are “underbanked.” That means a member of the household has a checking or savings account, but the household also uses check-cashing services and or other, more costly alternatives to traditional banks.

Many times through the years the federal government has feinted at requiring recipients of Social Security checks or disability payments or participants in other benefit programs to establish accounts for direct deposit. The argument was that electronic transfers would save the government the cost of printing and mailing a check and lessen the risk of payments being stolen.

U.S. Rep. Bennie Thompson has successfully fended off such requirements, saying it was too intrusive to require people to use the services of commercial banks if they preferred checks in their mailboxes. The actual figures back up Thompson’s position that this is no small group. Frankly, there are more non-banking households than we would have guessed.

The FDIC says minorities and the poor are disproportionately non-bankers. That seems counterintuitive. By merely having a small savings account, a person could avoid check-cashing fees each month. By having direct deposit, a Social Security recipient might even get checks earlier each month.

We agree with Thompson that it’s beyond the role of government to force people to open accounts if they don’t want to. But it would also seem that using bank services to save money or earn interest would be something people — especially the people most challenged to stretch every dollar as far as it will go — would do to help themselves.