Bank branches have closed by the thousands since the 2008 financial crisis, and closures have hit low-income and majority-Black neighborhoods and rural counties hard. Many of these places were redlined decades earlier and never had strong access to mainstream banking.
Without a nearby branch, people pay more to manage money. Check cashers charge fees on each check. Payday lenders charge annual interest rates that often reach hundreds of percent. People without a bank account also find it harder to build credit, get a mortgage or receive government payments quickly.
The racial gap is large. In 2023, 10.6 percent of Black households and 9.5 percent of Hispanic households had no bank account, compared with 1.9 percent of white households, according to the FDIC. Black-owned banks and community development credit unions, which serve many of these areas, hold a small share of US banking assets. The Community Reinvestment Act of 1977 requires banks to serve the communities where they take deposits, but critics say enforcement has been weak.