Boulder County program launches to serve area’s un- and under-banked

Oct. 27--Boulder County has an abundant -- and growing -- supply of banks: Nearly 35 for every 100,000 people, above the national average of 33. But those institutions are still failing to cater to many of the area's low-income residents.

A new program from the Department of Housing and Human Services (HHS) is taking aim at the estimated 20,000 households here without bank accounts, or else with an account that charges them thousands in fees. The initiative, in the works since January, launched to the public this week.

Bank On Boulder County is part of a national movement, deployed in 65 cities across the U.S. Its goal? Get more under-served citizens into free or cheap bank accounts that fit their busy lives -- and don't cost a fortune.

These households "typically use check cashing services or payday loans or cashier's checks to pay bills, all of which costs them a lot of money," said Katie Pague, housing and financial counseling coordinator with Boulder County HHS. "Folks who are un-banked are credit invisible: they don't have any kind of credit report at all."

In a review of data from the Federal Deposit Insurance Corporation (FDIC), personal finance website NerdWallet reported that people who deal only in cash face average annual costs of $198.83 for check cashing and money order services. The average income, after taxes, of households without a bank account is $18,203, the study found.

Those with bank accounts often sign up for overdraft protection, Pague explained, which can carry penalties that, compounded with interest, can cost hundreds over time. High monthly fees and opening deposit requirements are also barriers.

Bank On identifies checking and savings accounts that are more financially accessible. In Boulder County, five such accounts -- at Wells Fargo, Key Bank, First National, Chase and Bank of America -- have been identified from among a dozen different banks and credit unions.

Others are working to put together accounts that meet Bank On's national standards, which set limits on overdraft and other fees as well as opening deposits. Pague said she is "hopeful" more accounts will be available in the future.

The Bank On program also includes financial counseling from the county and the training of community "champions" at area nonprofits serving those most likely to be un- and under-banked. Champions are versed in what accounts are available and where, and can refer clients to them.

Boulder County, perhaps due to its overall higher incomes and robust offering of banks, is outperforming the nation in serving vulnerable populations. About 4 percent of households in 2015 were un-banked locally, compared to 7 percent nationally, and 12.2 percent were under-banked, compared to 19.9 across the U.S., according to a July report from the FDIC.

Shay Castle: 303-473-1626, castles@dailycamera.com or twitter.com/shayshinecastle

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