We, in the black community, probably thought it was only our Uncle Ray that was still using his mattress as his savings account, but according to a comprehensive survey by The Federal Deposit Insurance Corp. (FDIC) “nearly 22 percent of black households and 71 percent of families earning less than $30,000 do not use banks.” The Washington Post printed these statistics from the report that are both enlightening and surprising. The report states that Atlanta was #1 for unbanked and underbanked residents with Baltimore coming in second.
The banks tanked in the early part of the 20th century and a lot of people, no matter what color, didn’t trust the banking system from that point on. During the Great Depression, people found their funds were not insured and lost their shirts with no ombudsman to complain to nor anything more than an apology for the loss of their funds, thus the inception of the FDIC.
For the black community, specifically, a lack of security from the banks (and police) are a part of our experience. We have been third class citizens in every area of society as well as the financial spectrum with bad financial habits to match. BUT! We have also been some of the most resourceful people the world has ever known, thus our use of the mattress bank.
On Wednesday, Sen. Herb Kohl (D-Wis.) proposed legislation that will get the banks to reach out to those who are underserved by the banking system. And by “reaching out” he means for the banks to start opening up their vaults and releasing “small, short-term loans” that are federally guaranteed.
Read more of the Washington Post report here.