How about a solution to the structural problem?

This isn’t my domain, but just spitballing, we could use public funds to advertise credit unions in low income neighborhoods. Would credit unions want this, or would it lead to harmful consequences? Another way of asking this is, how come credit unions take these customers that banks won’t?

Postal banking would be a good solution. It would allow the post office to offer basic banking services for folks like this that can't access it at commercial institutions.

You need to allow everyone to do banking via this resource and they should also want to use it as a bank. Otherwise you'll run into a situation where that bank is associated with risky customers and is thus treated based on that reputation.

Don’t let the perfect be the enemy of the good/better.

If USPS banking helps the unbanked by only 50 units of help instead of a maximum of 100, it’s still a 50 point improvement. If Morgan Stanley or JPMorgan can offer me a better banking deal than the post office could, that’s no reason to not have the post office offer banking.

I agree it should be open to everyone, but don’t agree that there can be a maximum of zero-point-zero difference in customer base vs other banks.

Yeah, I did not mean to imply that postal banking would just be for high-risk customers. There are no postal banking plans where that's a restriction – everyone would have access to it, including many who are too far from a bank to have regular access. The post office is the government's widest reaching physical presence in this country with more locations than any other part of government, so it makes sense that this would be an inroad into banking for lots of people.

Easy, give every SSN a corresponding USPS/public bank account

I just love this narrative that someone who has lived their whole life with a fraught relationship with banks, overdrafting regularly, having trouble keeping their life in order, etc. will suddenly have the organization and forethought to walk into a bank, ask to speak with a manager, and be able to credibly promise that they want to fix this relationship.

I'm not saying people can't change, but it's naive as hell to think that they will on a dime such as you suggest.

It's not a narrative, it's my life experience. I saw it first hand, many times, which is why I commented.

Sadly, there are many who will not become more responsible with time. But there are also many who will, and I'm glad to have been able to play the smallest role in helping people who genuinely want a fresh start.

Sorry I didn't mean to suggest what you had said didn't happen, I very much believe you that people came in and said those words.

What I have a harder time believing, and not just in this situation but in a lot of conversations about the unbanked, is that these people will, after a lifetime of having problems with the banking system, suddenly "see the light" and start behaving in ways that are compatible with that same banking system.

This "fresh start" seems like the bad narrative, to me. I believe people seek it, and I believe they're hopeful about it, but I don't believe it's realistic to just assume. I definitely want to live in a world where people can choose to change, but suggesting that they actually will do that is, to me, not realistic.

I feel like a more effective approach would be to change how the banking system works, but I imagine that comes with a myriad of undesirable costs.

> I feel like a more effective approach would be to change how the banking system works, but I imagine that comes with a myriad of undesirable costs.

It seems likely to me that people who can't navigate the current banking system at a basic level would struggle with any banking system you introduce.

Or just any system in general.

This is very "fixed" mindset you're applying to others. Some portion of the populace grows up every year. There should be a path to re/build your life once that happens.

Also these institutions have protocols set up so as not to be able to see any “manager” at a given location. Hell in New York, it seems that a lot of inner city brick and mortar banking locations are becoming atm kiosks with maybe 1 or 2 employees there… not as tellers but instead to help with using the atms.

That would be because they have so many locations. You could walk down the street and around the corner to find another one.

Or are you saying that a bank manager is actually hard to find in NYC?

NYC isn’t only manhattan island

Ironically, I’ve seen “kiosks-only” at one bank branch in the Bay Area, and it was a local credit union.

Well if they can't get their shit together long enough to do something like that then this credit score system for checking accounts sounds perfectly reasonable to me.

I've been thinking about this a lot, and I think this is a good example of how we could do better as a society; some people who can't get checking accounts definitely can't handle the responsibility. Most of these people however, handle responsibility 10x as complex as this on a regular basis, and something is missing, either in a lack of shared cultural values (a lot of the unbanked are foreigners I think), or a lack of understanding of consequences (how many times have you heard the "I didn't know I'd fall down this well of overdraft fees"?).

In other words, the people involved usually are trustworthy in a generic "is it safe to bank with them", they're just not plugging into the system in a way that fits the defaults.

I'd almost argue that the banking system ought to be more flexible to maximize its compatibility with as many people as possible, and thus far hasn't because of the drive to maximize certainty and minimize all forms of risk.

I have no answers or real solid ideas for how to do this, but "it's all on them" doesn't quite feel right. These are (mostly) good people who will pay you back if you lend them money, and that should matter!

I think my comment got construed as "people can't change so it's all their fault" and I meant it more as, "financial systems should be willing to move closer to where these people are already at, and stop demanding these people make all the changes."

I also don't know how feasible that is, so... IDK! Just thinking via writing, I guess.

Thanks for being a realist! I was thinking the same thing.

I'm apt to be that cynical as well, but if what the original commenter said is true, that provides me with a little hope.

It's so easy to slip through the cracks in the system, so to speak. A sudden medical bill or car problems, for instance. I realized on my drive to work today that my car is the only thing keeping me from poverty. Luckily, I have tools in the back and would probably be able to fix it myself. :) Also, once you're in it, you're in it, and it's a strong cycle. You don't always have the luxury of things we often take for granted like having a nice outfit to wear, reliable transportation to an interview, and finally not even having a mailing address if you even end up getting a job offer.

It's like the places that offer a free shower and "nice" outfit (for an interview) to homeless people. Sometimes all it takes is that little boost to get (to be sure, the right person with the right attitude) someone back on their feet.

I've luckily never been in that situation, but I can empathize and understand how a completely ordinary person could quickly end up there.