Appendix D - FDIC Technical Notes 

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FDIC Technical Notes 

The data for this report were collected through a Federal 

Deposit Insurance Corporation (FDIC)-sponsored 

Unbanked/Underbanked Supplement to the Current Population Survey (CPS). The CPS is a monthly survey of 

about 54,000 interviewed households conducted by the 

U.S. Census Bureau for the Bureau of Labor Statistics 

(BLS). The survey is based on a scientific sample that 

“represents” the U.S. civilian, non-institutionalized population, aged 15 or older. 

The CPS is the primary source of information on the labor 

force characteristics of the U.S. population, including 

employment, unemployment, and earnings statistics. The 

CPS results include a variety of demographic characteristics, such as age, sex, race, marital status, and educational 

attainment. Additional information about the CPS is 

available in the Census Bureau’s Technical Paper 66, 

Design and Methodology of the CPS, available at http:// 

www.census.gov/cps/. 

The CPS is a state-based design in that separate samples 

are selected from each state, so that states serve as the 

primary sampling strata. The sample sizes for each state are 

set so that specific precision requirements for estimating 

unemployment rates will be met.1 The sample design 

ensures that most of the households in a given state have 

the same probability of being selected, though in general, 

these selection probabilities will vary across states. Because 

the CPS design is state-based, most of the estimates for the 

Unbanked/Underbanked supplement should be precise at 

the state level and for some sub-state areas (e.g., large 

metropolitan statistical areas (MSAs)). 

Unbanked/Underbanked Supplement 

The Unbanked/Underbanked Supplement was conducted 

for the first time in January 2009. The primary purpose of 

the supplement was to estimate the percentage of U.S. 

households that are “unbanked” and “underbanked” and to 

identify the reasons why households are unbanked or 

underbanked. The supplement survey instrument, attached 

as Appendix E, included approximately 30 questions 

designed to provide this information. The FDIC developed 

the survey instrument with the expertise of a national 

consulting firm, which specializes in public opinion 

research, as well as input from the Census Bureau’s Demographic Surveys Division and BLS. The survey instrument 

underwent four rounds of cognitive field pre-testing and 

The precision targets that are the basis for the sample design of the 

CPS are provided on pp.3–1 in Chapter 3 of the U.S. Census Bureau’s 

Technical Paper 66, available at http://www.census.gov/prod/2006pubs/ 

tp-66.pdf. 

was revised to address the feedback gathered from each 

round.2 

Eligibility and Exclusions 

All households that participated in the January 2009 CPS 

were eligible to participate in the Unbanked/Underbanked 

Supplement, but only those who specified whether someone in their household had a bank account (survey supplement Question 1) were considered supplement respondents. 

CPS household respondents who did not answer this question or answered “don’t know” were asked no further questions and were classified as nonrespondents for the 

supplement. 

Demographic characteristics, such as race, age, education, 

and employment, associated with a respondent household 

for the supplement are those reported for the householder/ 

reference person (i.e., a person who owns or rents the 

home). These demographic characteristics were used in 

preparing report estimates and tables. 

A small proportion of supplement respondents (1.5 

percent, or 1.8 million households) reported that they did 

not participate in their household finances, or they did not 

report their level of involvement with their household 

finances (supplement survey instrument Question 2). 

Although these households answered Question 1 on 

whether their household had a bank account, they were 

excluded from the remainder of the survey because of their 

lack of involvement in their household’s finances. Consequently, unless otherwise noted, these households were 

treated as missing/unknown observations in the preparation of tables reporting answers to supplement questions 

other than Question 1. 

Coverage and Response Rates 

The target universe for the CPS is all civilian non-institutionalized persons (aged 15 or older) residing in the 50 

states and the District of Columbia. In order to reach this 

universe, a list (sampling frame) of about 110 million 

households was developed from the Master Address File 

used for the 2000 Census, plus three additional frame 

sources (group quarters, area canvassing, and building 

permits). 

For the January 2009 CPS, a statistical sample of approximately 58,600 survey-eligible households was selected from 

2 The goal of each round was to determine respondents’ comprehension 

of each question, test the flow of the questions, find major recall difficulties, ascertain the sensitivity or inappropriateness of any questions, and 

gauge the operational feasibility of the supplement. No changes to the 

survey were recommended following the fourth round of testing. 

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the sampling frame. Of these, about 53,900 households 

participated in the CPS, resulting in a 92 percent response 

rate. There were about 4,700 nonrespondent households. 

Most of these nonrespondents either refused to participate 

(57 percent of nonrespondents) or were not home at the 

time of the interview visit or call (26 percent). The 

remaining 17 percent consisted of households where (a) 

the household respondent was temporarily absent, (b) the 

household could not be located, (c) language barriers 

prevented the interview, or (d) “other” reasons. Because of 

the availability of translators for many languages, only 0.5 

percent of the nonrespondents (22 households) did not 

participate as a result of language barriers. 

About 46,500 (86 percent) of the 53,900 households 

participating in the CPS also participated in the 

Unbanked/Underbanked Supplement.3 The supplement 

survey response rates vary by demographic groups, ranging 

from 81 percent to 88 percent. 

Coverage ratios for the CPS are derived as a measure of 

the percentage of persons in the target universe (civilian 

non-institutionalized persons aged 15 or older in the 

United States) that are included in the sampling frame.4 

The overall coverage ratio for the January 2009 CPS was 

88 percent. The missing 12 percent consists of three 

groups: (1) persons residing in households that are not in 

the CPS sampling frame, (2) non-institutionalized persons 

not residing in households at the time the CPS was 

conducted, and (3) household residents that were not listed 

as household members for the CPS for various reasons. 

The coverage ratios varied across demographic groups. For 

example, the coverage ratio was 89 percent for whites, 80 

percent for blacks, and 86 percent for Hispanics. 

The weights calculated by the Census Bureau for the CPS 

and the Unbanked/Underbanked Supplement respondents 

were adjusted to account for both nonresponse and undercoverage. These weight adjustments help correct any biases 

in estimates because of nonresponse and undercoverage, so 

that results from the CPS are “representative” of the civilian, non-institutionalized U.S. population.5 

3 Taking into account the nonresponse to basic CPS questions, the overall response rate for the Unbanked/Underbanked Supplement Survey was 

79 percent. 

4 The coverage ratio is the weighted number of persons in a demographic 

group (after weights are adjusted to account for household nonresponse) 

divided by an independent count of persons in that demographic group 

(obtained from the 2000 Census with updates based on the American 

Community Survey). 

5 This adjustment is done by introducing three stages of ratio estimation 

that adjust weights to align with population control totals (independent 

population estimates for various demographic groups). The household 

weight is generally taken to be the weight of the householder/reference 

person. 

Analysis of Supplement Survey Results 

Using supplement survey results, households were classified 

as “unbanked” if they answered “no” to the question, “Do 

you or does anyone in your household currently have a 

checking or savings account?” Households answering “yes” 

to this question were classified as “underbanked” if they 

indicated that they had used at least one alternative financial service (non-bank money orders, non-bank checkcashing services, payday loans, rent-to-own services, or 

pawn shops) at least once or twice in the previous year, or 

that they had obtained a refund anticipation loan at least 

once in the previous five years.6 

The estimated proportion of U.S. households that are 

unbanked was derived by dividing the sum of the weights 

of the household respondents that were identified as being 

unbanked by the sum of the weights of all household 

respondents. The same formula was used to estimate the 

proportion of U.S. households that are underbanked. For 

estimated proportions of unbanked or underbanked households for demographic subgroups, the same computational 

approach was used and applied to respondent households 

in the subgroup. 

In addition to presenting estimated proportions, many of 

the tables in this report include estimated numbers of 

households (e.g., total households, unbanked households, 

or underbanked households). An estimated number of 

households for a given category (such as unbanked) is 

derived as the sum of the weights of the sample households 

in that category. For example, for the entire sample of 

about 46,500 households, the sum of the household 

weights is 118,574,000, which would be an estimate of all 

U.S. households as of January 2009. However, the Housing 

Vacancy Survey, another survey related to the CPS that 

uses household controls to produce household weights, 

provided an estimate of 110,552,000 as the number of 

households in January 2009. This difference (118,574,000 

vs. 110,552,000) is due to the fact that household weights 

prepared by Census for the CPS and for this supplement 

survey are generally taken to be the reference person 

weights and are not adjusted to align with household 

controls. Household controls were not used to adjust 

household weights because the CPS is a person survey 

rather than a household survey; therefore, universe 

controls were used only in the preparation of person 

weights. As a result, the sum of household weights shown 

in our tables for a category tends to be somewhat higher 

than the actual household count for the category. 

6 The different time frame for refund anticipation loans reflects the fact 

that these products are typically used only once a year, during tax preparation season. 

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There are a number of tables in this report for which 

unbanked percentages and other household statistics are 

computed for subgroups defined by a particular economic 

or demographic characteristic. The household classification of an economic or demographic variable that is 

defined at the person level rather than the household level 

(e.g., race, education, or employment status) is based on 

the economic or demographic classification of the householder/reference person (i.e., a person who owns or rents 

the home). 

The Census Bureau classifies households into different 

household types. For instance, a family household is a 

household that includes two or more people related by 

birth, marriage, or adoption and residing together, along 

with any unrelated people who may be residing there. 

Detailed definitions regarding household types can found 

in the CPS Glossary available at http://www.census.gov/ 

apsd/techdoc/cps/mar97/glossary.html. 

Households are categorized into racial-ethnic classifications as follows: If the householder was identified as black, 

the household was classified as “Black” regardless of 

whether the householder was identified as Hispanic or any 

other race. If the householder was not identified as black 

and is identified as Hispanic, the household was classified 

as “Hispanic Non-Black.” If the householder is identified as 

white and not any other race and non-Hispanic, then the 

household was classified as “White.” All remaining households are classified as “Other.” However, in some national 

summary tables the “Other” category is further disaggregated into “Asian” if the householder is identified as Asian, 

“American Indian/Alaskan” if the householder is identified 

as American Indian/Alaskan and not Asian, and “Hawaiian/Pacific Islander” if the householder is identified as 

Hawaiian/Pacific Islander and not Asian or American 

Indian/Alaskan. In these tables “Other” consists of the few 

remaining households in which the householder cannot be 

classified into any of the preceding groups. 

The counties included in some of the MSAs selected for 

the CPS do not correspond exactly to the counties 

included for these MSAs in the official definitions 

prepared by the Office of Management and Budget (OMB) 

for two basic reasons. 

First, in redesigning the CPS in a timely manner to incorporate results from the 2000 Decennial Census, the 

Census Bureau had to project revised MSA definitions 

prior to the release of the official OMB definitions in 2003. 

Therefore, in some cases, the Census Bureau included one 

or two counties in an MSA for the CPS that were not 

subsequently included in the official definition of the 

MSA. In other cases, the Census Bureau excluded one or 

two counties that were subsequently included in the official definitions of an MSA. In the latter case, the data for 

the MSA in the CPS (and in the unbanked/underbanked 

supplement) will not include any responses for one or two 

of the counties that are a part of the official definition of 

the MSA.7 

Second, since the CPS is a state-based design, MSAs that 

include counties in more than one state are subdivided 

into their respective state components for sampling 

purposes. Therefore, for some multi-state MSAs, the counties belonging to one or two of the states were not selected 

for the CPS sample, even though the counties making up 

the other portion of the MSA were selected. The larger 

portions are usually included in the CPS since they would 

be selected with certainty for their state sample because of 

their size (i.e., those larger portions would be “self-representing”). Also, for some multi-state MSAs, the part of the 

MSA contained in a given state is selected for the CPS 

sample but cannot be identified as belonging to the MSA 

(for confidentiality reasons) because it contains fewer than 

100,000 people. In such cases the respondents in that state 

usually would be identified as belonging to a metropolitan 

area, but the specific MSA would not be identified. 

Statistical Precision of Estimates 

Standard errors were calculated for certain Unbanked/ 

Underbanked Supplement Report estimates to indicate the 

precision of these estimates. For example, the standard 

error can be used to compute a 95 percent confidence 

interval for a survey estimate (this is generally computed as 

the estimate plus or minus two times the standard error). If 

the survey estimate of interest is a difference between estimates for different groups, the estimated standard error can 

be used to determine whether the observed difference is 

“statistically significant.” Differences discussed in this 

report are significant at the 10 percent level of significance. That is, if there were no difference in the true 

universe values of the two sample estimates being 

compared, the probability of obtaining sample estimates 

having this observed difference or a larger difference would 

be no more than 10 percent, and could be considerably 

less. 

The standard errors presented in the full report on the 

FDIC’s Unbanked/Underbanked Supplement were calculated based on the variation of a survey estimate across a 

set of 160 sample replicates provided by the Census 

Bureau. Details of the calculation of standard errors based 

7 In the former case, data for any counties that were not subsequently 

included in the official definition of an MSA are coded as 

non-metropolitan. 

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on sample replicates (and on the CPS methodology in 

general) are available from the Census Bureau.8 

For a detailed description of the methodology used to calculate standard errors using replicates see U.S Census Bureau Technical Paper No. 

66, Chapter 14, available at http://www.census.gov/prod/2006pubs/tp-66. 

pdf. 

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