CONSUMER BANKING RELATIONSHIPS BY INCOME BRACKET
FOR 11,965 U.S. CONSUMERS | DATA AS OF 12.31.22
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- A report from the Federal Reserve shows credit unions and others are making progress in their efforts to reduce the number of un- and underbanked consumers. The report — dated 2022 but reflecting 2021 data — shows a clear correlation between income, education, and banking status. The overall figures are largely unchanged from 2020 and 2021, but the number of unbanked consumers has dropped by 7% since 2015.
- That seven-point decline does not reflect improvements in financial inclusion, the report notes. Rather, a decline in the usage of alternative financial services might have resulted in an uptick in usage of nonbank products that are more difficult to track, according to the Fed.
- For those with banking accounts, overdrafts remain a concern. Sixteen percent of consumers with incomes below $50,000 paid overdraft fees in 2021, along with 10% of those with incomes from $50,000 to $99,999, and 5% of those making $100,000 or more.
- Thirty-eight percent of adults applied for credit, but more than one-quarter of those applicants say they were either denied credit or approved for less than needed (although that figure is a three-point decline from one year prior). Applicants with lower incomes were denied credit more frequently than those bringing home $100,000 per year or more. Black consumers had the highest levels of decline, regardless of income.
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