According to a study conducted by the Federal Deposit Insurance Corp., the percentage of South Carolina households having no checking or savings account fell to its lowest level since the FDIC started tracking data.
The report, the FDIC National Survey of Unbanked and Underbanked Households, found that 8.9% of households in South Carolina were classified as “unbanked.” That was down 15% from the 10.5% of households under that classification in 2013. Nationally, the percentage of those unbanked dropped to 7%.
This table looks at the percentages of unbanked
State Underbanked Unbanked
Alabama 23.9% 12.5%
Florida 17.7% 5.9%
Georgia 24.6% 11.9%
North Carolina 20.6% 7.7%
South Carolina 23.4% 8.9%
Tennessee 19.2% 10.8%
Virginia 19.7% 4.6%
Source: FDIC National Survey of Unbanked
Just over 23% of South Carolinians were found to be underbanked, according to the survey. That was a drop from 25.6%. According to the report, being underbanked includes having “an account at an insured institution, but also obtaining financial services and products from outside the banking system.” The report said, nationally, there were 19.9% of Americans considered underbanked.
“This is another indication of the successful efforts that South Carolina bankers have made to reach out to all segments of society,” said Fred Green, president and CEO of the South Carolina Bankers Association, in a news release. “Many of our member institutions have implemented programs and plans specifically designed to assist the unbanked and underbanked.”
South Carolina’s 15% drop in unbanked was more than the national average decline of 9%. In the region, North Carolina had 20.6% reported as underbanked and 7.7% unbanked while Georgia had 24.6% underbanked and 11.9% unbanked.
Martin Gruenberg, FDIC chairman, said it is incumbent upon banks to develop relationships with customers in an attempt to help those customers build assets and become “less susceptible to discriminatory or predatory lending practices.”
"The decline in the share of households who do not have a banking relationship is a positive development, and the FDIC will continue working to help ensure households have access to safe, secure and affordable banking services,” Gruenberg said, in a news release.
Nationally, the FDIC survey found that more than 20% of unbanked households reported saving for an emergency in the last year and 67.8% said they had emergency savings in their home, with a family member or with a friend. The FDIC said that was a sharp contrast from the 88.2% of fully banked households that reported keeping their emergency funds in a bank account.
Additionally, the report found that 36.9% of the population uses online banking as their primary method for accessing their accounts. Smartphone usage for banking rose from 5.7% in 2013 to 9.5% in 2015.
Green said one reason for the decrease in South Carolina is better education. He said the SCBA’s Young Bankers Division has worked to increase financial literacy with younger bankers. He said the division “touched nearly 200,000 South Carolinians through financial literacy efforts” between 2013 and 2015.
“That number has remained strong for many years and I believe there is a direct correlation between the Young Bankers’ financial literacy push and the drop in unbanked and underbanked individuals in our state,” Green said. “Financial literacy has long been one of the prime areas of focus for us and results like these show they’re making a difference.”