From JP Morgan

1. Who are the Unbanked? From JP Morgan • 22 million US households have no bank account at all and another 20 million are estimated to be underbanked (i.e., limited to no financial relationships) • 60 million Americans receive paper checks; over 40% of this population does not have a bank account and needs a direct deposit vehicle • Over $500 bn in payroll checks are issued annually to unbanked employees Office of the Comptroller of the Currency The OCC estimates that a typical consumer who monthly cashes two $400 checks and buys five money orders to pay bills would incur $270 in annual costs not including any remittance fees. (June 2005) South Carolina Council On Economic EducationMoor School of Business ● 1705 College Street ● Room 651● Columbia, SC 29208 ● (803) 777-8328 ● (803) 777-8328www.sceconomics.org

2. Who are the Unbanked (2001 Federal Reserve Survey) • 9% of all US families- slightly less than 10 million families • Low to moderate incomes • Young and non white • 5% of non Hispanics whites vs. 22% of non whites and Hispanics as a group • Of the families in the lowest income quintile, 31% are unbanked • Why do they not have a checking account? • Don’t write enough checks to make it worthwhile- 28.6% • Do not like dealing with banks-22.6% • Don’t have enough money- 14% • Service charges are too high- 10.2% • Cannot manage or balance a checking account- 6.6% • Min. balance too high- 6.5% • Do not need or want a checking account- 5.4% • Credit problems-3.6% • No bank/no location/bad hours- 0.4% • Other- 2.1% • Over 52% of the unbanked families previously had a checking account, suggesting that something about their financial circumstances and/or behavior lead them to leave the financial mainstream • In a study of 480 workers done by the Center for Community Change and Community Financial Resources: • Median annual income- $15,600 • Median monthly remittance- $293 • Median monthly savings- $289 • Close to half were unbanked even with proper credentials South Carolina Council on Economic EducationMoore School of Business ● 1705 College Street ● Room 651● Columbia, SC 29208 ● (803) 777-8676 ● (803) 777-8328 faxwww.sceconomics.org

3. South Carolina Council on Economic EducationMoore School of Business ● 1705 College Street ● Room 651● Columbia, SC 29208 ● (803) 777-8676 ● (803) 777-8328 faxwww.sceconomics.org Over 25 million households are unbanked