About Consumer Research Perspectives
Consumer Research Perspectives are short research briefs that use data to explore questions related to economic inclusion. One focus is the participation of U.S. households in the mainstream banking system. Briefs often use data collected by the FDIC National Survey of Unbanked and Underbanked Households to address questions with greater depth than in the biennial report.
Disclaimer: The views expressed in Consumer Research Papers and Briefs are those of the authors and not necessarily those of the Federal Deposit Insurance Corporation or the United States.”
July 2024
A Closer Look At The Unbanked: Cash-Only Households Versus Those That Use Prepaid Cards or Nonbank Payment Apps
by Ryan Goodstein
Most unbanked households in the United States are “cash only,” meaning they use neither prepaid cards nor nonbank payment apps. These households must rely primarily on in-person cash transactions and thus are at risk of theft or loss when handling their day-to-day finances. Going forward, the cash-only unbanked may find it increasingly difficult to participate in the formal economy as the U.S. financial system evolves toward a more digital infrastructure. Economic inclusion strategies targeted toward the cash-only unbanked should focus on building trust in banks and demonstrating the value of a bank account, as this population appears to be especially disconnected from the mainstream banking system.