Pub. 11 2021 Issue 3

6 azbankers.org Washington Update Banking On Inclusion: America’s Banks Embrace Bank On Movement By Rob Nichols, President and CEO American Bankers Association A MERICA’S BANKS HAVE A LONGSTANDING COMMITMENT to helping reduce the number of unbanked and underbanked individuals and families in the U.S. July marked a major milestone in that endeavor, with an announcement from the Cities for Financial Empowerment Fund that the number of Bank On-certified deposit accounts now available has surpassed 100. At the time this column was written, it was up to 114. As you may recall, nearly a year ago, I challenged banks of all sizes to offer Bank On-certified products, designed to promote access to financial services to the roughly 5% of U.S. households that remain unbanked. To receive Bank On certification, the account must meet specific standards, including low costs, no overdraft fees, robust transaction capabilities via a debit or prepaid card, and free online bill pay. The certification is free and the process is simple. When I issued that challenge in October 2020, there were 43 banks offering accounts that were Bank On-certified. Today, there are more than 90, with plenty more in the process of obtaining certification. In particular, we’ve seen a significant uptick in the number of community banks offering Bank On-certified accounts. This is partly due to ABA’s efforts to engage with 20 of the nation’s core technology providers – including Fiserv, FIS, Jack Henry and Associates, and Finastra – and encourage them to simplify the process for their bank clients to create and offer these critical products. Today, Bank On accounts are available in more than 32,500 branches in 99 out of the 100 largest metropolitan markets and all 50 states. They have received plaudits from bank regulators and policymakers alike – and for a good reason. Research suggests that the initiative is working as intended: according to the Federal Reserve Bank of St. Louis, 75% of consumers opening Bank On certified accounts were new customers for that bank. Additionally, while these accounts have widespread appeal, CFE Fund reports that customers opened close to 60% of Bank On certified accounts in communities with 50% or more people of color. The importance of having a banking relationship has never been more apparent than during the COVID-19 pandemic. From obtaining