Banks in Indiana are using prepaid cards and second-chance checking accounts to help unbanked people get into the financial mainstream, the Indianapolis Business Journal reports.
Chase Bank has its Liquid card, Regions Bank its NOW card, and PNC Bank its SmartAccess card—all prepaid debit cards that don’t allow overdrafts. On the deposit side, Fifth Third has its Express Banking account, PNC has its Foundations Checking account, and Old National Bank has its EZ Access account.
“It doesn’t matter if we’re in Muncie or Anderson or Indianapolis or Lafayette, there’s a certain part of the community that has issues with their credit,” said Mike Stewart, chief banking officer at Muncie-based First Merchants Bank, which launched its Simple Access card in August. “So we do feel it’s a responsibility to offer such products and help those that want to help themselves.”
The article discusses how expensive life can be for cash-based people, and how easy it is to lose access to a bank account. However, if banks and credit unions want to tap the true potential of their customers, then they need to provide the information and tools to help customers save, built their credit scores, and ultimately become users of the institution’s full line of products from transaction accounts to wealth management. Mercator Advisory Group has explored this concept in its report: “The Six Million Dollar Customer: Using Technology to Build a Profitable Customer Base.” The strategy implication is clear, those institutions who can best help customers build their personal wealth will become the most profitable institutions.
Overview by Ben Jackson, Director, Prepaid Advisory Service at Mercator Advisory Group
Read the full story here
Read the full report here