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Released: July 06, 2011

Poor often don’t know benefit of banks

Source: Taryn Luna, Boston Globe (Free Registration)

Low-income families use costly check-cashing and loan services not because they lack access to banks, but because they lack knowledge of banking options and their advantages, according to a study by the University of Massachusetts Dartmouth. For example, the study found that about one in four low-income residents in the New Bedford area do not have a bank account because they believe they cannot afford it - although most community banks and credit unions offer low-cost or free accounts as required by state law. In addition, the study found, even low-income residents with bank accounts still use check-cashing establishments more than their banks.

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