FDIC National 

Survey of 

Unbanked 

and 

Underbanked 

Households 

Executive Summary 

Federal Deposit 

Insurance Corporation 

December 2009 
 

Members of the FDIC Unbanked/Underbanked Survey Study Group 

Team Members: 

Office of the Vice Chairman: Barbara Ryan and Yazmin Osaki 

Division of Insurance and Research: Susan Burhouse, David Chapman, Timothy Critchfield, Ryan Goodstein and Katherine 

Samolyk 

Division of Supervision and Consumer Protection: Angelisa Harris and Luke Reynolds. 

Legal: Leneta Gregorie 

Contributors: Michael Bachman, Peggi Gill, Michael Glenwick, Jocelyn Grazal, Peter Johnston, David Spanburg, Jacques Vilar, 

and Kathy Zeidler 

FDIC National Survey of Unbanked and Underbanked Households ■ DECEMBER 2009 2
 

Executive Summary 

In January 2009, the Federal Deposit Insurance Corporation (FDIC) sponsored a special supplement to the U.S. 

Census Bureau’s Current Population Survey (CPS) to 

collect national, state, and metropolitan statistical area 

(MSA) data on the number of U.S. households that are 

unbanked and underbanked, their demographic characteristics, and their reasons for being unbanked and underbanked.1 The Census Bureau surveyed approximately 

54,000 households, and about 47,000 (86 percent) participated in the FDIC’s supplement survey. 

The FDIC undertook this effort to address a gap in reliable 

data on the number of unbanked and underbanked households in the United States. Access to an account at a 

federally insured institution provides households with the 

opportunity to conduct basic financial transactions, save 

for emergency and long-term security needs, and access 

credit on affordable terms. Many people, particularly lowto-moderate income households, do not have access to 

mainstream financial products such as bank accounts and 

low-cost loans. Other households have access to a bank 

account, but nevertheless rely on more costly financial 

service providers for a variety of reasons. In addition to 

paying more for basic transaction and credit financial 

services, these households may be more vulnerable to loss 

or theft and often struggle to build credit histories and 

achieve financial security. 

The FDIC also conducted this survey to comply with a 

statutory mandate that requires it to conduct ongoing 

surveys of banks on their efforts to serve the unbanked.2 

The supplement survey complements the FDIC Survey on 

Banks’ Efforts to Serve the Unbanked and Underbanked, 

published in February 2009, and provides insights into the 

size of the unbanked and underbanked markets. It also 

presents a wealth of previously unavailable data regarding 

households’ banking status and related issues. Teamed 

with the rich demographic and geographic data available 

through the CPS, the supplement survey represents the 

1 The data for this report were collected through an FDIC-sponsored 

Unbanked/Underbanked Supplement to the Current Population Survey 

(CPS). Additional information on the CPS is available at http://www. 

census.gov/cps/. For additional methodological details and definitions, 

refer to the FDIC technical notes located in Appendix D of the full report. 

2 Section 7 of the Federal Deposit Insurance Reform Conforming Amendments Act of 2005 (Reform Act) requires that the FDIC conduct biennial 

surveys of insured depository institutions’ efforts to bring individuals and 

families who have rarely, if ever, held a checking account, a savings 

account, or other type of transaction or check-cashing account at an 

insured depository institution into the conventional finance system. The 

Reform Act also asks the FDIC for a “fair estimate” of the size and worth 

of the “unbanked” market in the United States. 

first time such data on unbanked and underbanked households are available at the national, state, and large MSA 

levels. It is hoped that these survey results will help better 

inform the industry and policymakers about economic 

inclusion issues, and promote the goal of ensuring that all 

Americans have access to basic, safe, and affordable bank 

services. 

Key Overall Findings 

• An estimated 7.7 percent of U.S. households, 

approximately 9 million, are unbanked.3 At least 17 

million adults reside in these unbanked households 

(see Figure 1.1).4 

• The proportion of U.S. households that are 

unbanked varies considerably among different racial 

and ethnic groups, with certain racial and ethnic 

minorities more likely to be unbanked than the 

population as a whole. Minorities more likely to be 

unbanked include blacks (an estimated 21.7 percent 

of black households are unbanked), Hispanics (19.3 

percent), and American Indian/Alaskans (15.6 

percent). Racial groups less likely to be unbanked are 

Asians (3.5 percent) and whites (3.3 percent).5 

• In addition to the unbanked households, an estimated 17.9 percent of U.S. households, roughly 21 

million, are underbanked.6 The number of adults that 

3 For the purposes of this survey, households were identified as unbanked 

if they answered “no” to the question, “Do you or does anyone in your 

household currently have a checking or savings account?” 

4 In addition, unbanked adults may also reside in other households. Adults 

are defined as persons aged 16 and older. This is a lower-bound estimate 

of the number of unbanked adults in the United States because it is based 

on the assumption that all adults residing in a “banked” household are 

banked. A banked household may contain one or more unbanked adults; 

these unbanked adults residing in banked households are not included in 

the 17 million adults figure cited above. 

5 The demographic characteristics of a household are taken to be those 

of the owner or renter of the home (i.e., “householder”), unless the demographic characteristic is one defined at the household level, such as 

income or household type. For convenience, some abbreviated language 

will be used to refer to the demographic characteristics of households. For 

example, the term “black household” refers to a household for which the 

householder has been identified as black. Refer to the FDIC technical 

notes for the race/ethnicity and other definitions used in this report. 

6 Underbanked households are defined as those that have a checking or 

savings account but rely on alternative financial services. Specifically, 

underbanked households have used non-bank money orders, non-bank 

check-cashing services, payday loans, rent-to-own agreements, or pawn 

shops at least once or twice a year or refund anticipation loans at least 

once in the past five years. 

FDIC National Survey of Unbanked and Underbanked Households ■ DECEMBER 2009 3
 

 

 

 

 

 

 

reside in these underbanked households is about 43 

million.7 

• Certain racial and ethnic minorities are more likely 

to be underbanked than the population as a whole. 

Minorities more likely to be underbanked include 

blacks (an estimated 31.6 percent), American Indian/ 

Alaskans (28.9 percent), and Hispanics (24.0 

percent). Asians and whites are less likely to be 

underbanked (7.2 percent and 14.9 percent, respectively). 

Figure 1.1 Banking Status of U.S. Households 

Underbanked 

17.9% 

Unbanked 

7.7% 

Banked, but Not 

Underbanked Banked, but 70.3% Underbanked 

Status Unknown* 

4.1% 

Notes: Percentages are based on 118.6 million U.S. households. Percentages do not always sum to 100 

because of the rounding of household weights to represent the population totals. 

* These households are banked, but there is not enough information to determine if they are underbanked. 

• Taken together, at least 25.6 percent of U.S. households, close to 30 million, are either unbanked or 

underbanked. Approximately 60 million adults reside 

in these households. 

• Overall, almost 54 percent of black households, 

44.5 percent of American Indian/Alaskan households, and 43.3 percent of Hispanic households are 

either unbanked or underbanked. 

• While 17.9 percent of U.S. households are known 

to be underbanked, another 4.1 percent of U.S. 

households, or roughly 5 million, are banked and 

may also be underbanked, but their use of AFS could 

not be determined because of missing data. The 

number of adults that reside in these households is 

estimated to be 11 million. 

• The proportion of unbanked and underbanked 

households varies across different regions of the 

country, with the highest incidence in the Southern 

7 This is an upper-bound estimate of the total number of underbanked 

adults in the United States because it is based on the assumption that all 

adults residing in an underbanked household are underbanked. However, 

an underbanked household may contain one or more adults that are not 

underbanked. 

Region. In addition, the proportion of unbanked 

households varies considerably among certain racial 

and ethnic minorities across states and MSAs. 

Additional Key Unbanked Findings 

• Family households for which the householder is an 

unmarried female or unmarried male are considerably more likely than married couple households to 

be unbanked.8 Almost 20 percent of unmarried 

female family households and 14.9 percent of unmarried male family households are unbanked, compared 

with about 4 percent of married couple family 

households. 

• A substantial percentage of lower-income households are unbanked. Nearly 20 percent of lowerincome U.S. households—almost 7 million 

households earning below $30,000 per year—do not 

currently have a bank account. Households with earnings below $30,000 account for at least 71 percent of 

unbanked households. 

• The proportion of unbanked households declines 

with education and age. Households more likely to be 

unbanked than all U.S. households have less than a 

college education or a householder under age 45. 

• Not having enough money to feel they need an 

account is the most common reason why unbanked 

households are not participating in the mainstream 

financial system. 

• The 9 million unbanked households are approximately split between households that have never 

had a bank account (46.9 percent) and households 

that were previously banked (49.0 percent). 

• A considerable proportion (an estimated 41.1 

percent) of unbanked households believes that 

opening a bank account in the future is “not likely 

at all.” However, among all unbanked households, 

the previously banked are more likely to consider 

opening a bank account in the future. About 16 

percent of previously banked households believe that 

they are “very likely” to open a bank account, 

compared with 4.8 percent of those that have never 

been banked. 

8 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. For the definition of 

‘householder’ see footnote 5. Detailed definitions regarding household 

types can be found in the CPS Glossary available at http://www.census. 

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

FDIC National Survey of Unbanked and Underbanked Households ■ DECEMBER 2009 4
 

• About 66 percent of unbanked households use the 

following alternative financial services (AFS): nonbank money orders and non-bank check-cashing, 

pawn shops, payday loans, rent-to-own agreements 

(RTOs), and refund anticipation loans (RALs). 

About one-quarter of unbanked households do not use 

any AFS, suggesting a strong reliance on cash 

transactions. 

• Approximately 12 percent of unbanked households 

have used a general spending prepaid card, and an 

estimated 3.1 percent receive their income through 

a payroll card. 

Additional Key Underbanked Findings 

• Family households for which the householder is an 

unmarried female or unmarried male are considerably more likely than married couple family households to be underbanked. About 28 percent of 

unmarried female family households and 27 percent of 

unmarried male family households are underbanked, 

compared with 15.4 percent of households with a 

married couple present. 

• The underbanked rate declines with age of the 

householder but is more evenly distributed across 

most educational and income groups. For example, 

middle-income households (those with annual income 

between $30,000 and $50,000) are about as likely as 

lower-income households (those with annual income 

below $30,000) to be underbanked. The proportion of 

underbanked households is considerably lower among 

the highest education level of the householder (at 

least college degree) and the highest income group (at 

least $75,000). 

• The AFS products used most frequently by underbanked households are non-bank money orders (an 

estimated 81.1 percent of underbanked use money 

orders) and check-cashing (30.0 percent) transaction services. Underbanked households also use on 

payday lenders (16.2 percent), pawn shops (15.8 

percent), RTO services (13.0 percent), and RALs 

(13.2 percent) for credit services from non-banks. 

• The survey data indicate that the majority of underbanked households that go to nonbanks for money 

orders and check cashing do so primarily for convenience. Speed and cost were also reasons underbanked households use these non-bank transaction 

services. 

• Many underbanked households that use payday 

loans or pawn shops rather than banks for credit 

services do so primarily because it is easier to qualify for a loan from the AFS provider or because it is 

more convenient. 

• Approximately 16 percent of underbanked households have used a general spending prepaid card and 

an estimated 4.2 percent receive their income 

through a payroll card. 

The full report that follows focuses primarily on the key 

issues the FDIC intended to address in conducting the 

survey. It is organized as follows: Section 2 provides background and objectives; Section 3 provides a brief overview 

of the survey findings related to the national percentage of 

unbanked and underbanked households; Section 4 summarizes findings related to unbanked households; Section 5 

summarizes findings related to underbanked households; 

Section 6 compares select demographic characteristics of 

unbanked and underbanked households; and Section 7 

provides concluding remarks. Detailed national, state, and 

MSA-level tables appear in Appendices A, B, and C. 

Technical notes for the FDIC’s supplement survey appear 

as Appendix D, and the supplement survey instrument is 

included as Appendix E. 

FDIC National Survey of Unbanked and Underbanked Households ■ DECEMBER 2009 5