A couple of years ago, Toledo Mayor Mike Bell contacted all the CEO's of financial institutions, including WNWO Today's Money Monday expert, David Seeger. Seeger tells us he was invited to attend a meeting for an initiative Bell wanted to pursue for the community.
Many people in the community are defined as "unbanked" or "under banked," and they are effectively being charged excessive service fees for the purchase of money orders or check cashing. Bell wanted to model a program based upon what was done in San Francisco to address this problem. So, the Toledo financial community worked together and have started the 'Bank on Toledo' program.
Seeger gave us some facts and figures on Monday's show that might be of interest and will perhaps surprise many. As of today, 8.6 percent of American households are unbanked, meaning they have no banking relationship at all. And 20.8 percent of American households are under banked, meaning they have one bank account, do not fully utilize traditional banking products, and rely on non-traditional banking options for their banking needs.
The total unbanked and under banked in Toledo is 24 percent, higher than the national average.
These numbers are increasing largely due to a weak economy, but one of the other main reasons people remain in this condition is fear and lack of trust with a financial institution. The other is a lack of financial education on how to acquire or properly maintain such an account. Many "unbanked" people carry large sums of money on them which makes them prey to robbery and assault.
The 'Bank on Toledo' program offers the community an opportunity to open a bank account with no or low fees to get started, even if they have had issues in the past with previous banking experiences. It is a second chance, so to speak. As part of the program, th ey must attend financial education programs geared to teach them how to acquire and manage a bank account, as well as all of their money in general (budgeting) and how to obtain and judicially utilize credit.
For more information on how to participate in the program, go to www.bankontoledo.org.