Edwards said many families avoid banks because they get wrong information from friends and relatives.
“If that information was incorrect or incomplete, that was what they used to make their decisions,” she said, stressing that financial education is important for all consumers. “The more information you have about financial matters, the better financial decisions you’ll make.”
Regardless of an individual’s income or background, she said, “it’s important to have a relationship with a bank, even if it is for a savings account.” Being banked with a regulated financial institution allows individuals to save, have access to fair credit and to invest, such as making payments on a house to build equity. Banks also guarantee the safety of deposits.
“Given what has happened to Oklahoma (with tornadoes wiping out homes and possessions) in the last few weeks, I would hope that those who don’t have a relationship with a financial institution, they would see the importance of one,” Edwards said.
The number of unbanked households in Oklahoma increased from 2009 to 2011, according to the surveys. However, Oklahoma City and Tulsa saw a drop, Edwards said, meaning outreach efforts need to focus on rural areas.
Bank On, an organization with more than 70 programs nationwide, is one solution, Edwards said. The group attempts to create partnerships among financial institutions, community-based groups, and local and state governments to help those underserved by banks. Programs are offered at the city, county or state level, providing resources such as free or low-cost accounts and financial education.
Edwards said Colorado established Bank On Denver in 2009, when about 9 percent of Denver’s residents were unbanked. The group targeted minority populations, offering products and education tailored to the underserved demographic. In 2011, that number dropped to 5.2 percent.
“We think that the key reason was the launch of the Bank On campaign,” Edwards said. “I have no reason to believe it couldn’t be replicated in Oklahoma.”
Oklahoma Watch is a nonprofit organization that produces in-depth and investigative journalism on important public-policy issues facing the state.