People without bank accounts rely on payday lenders and check-cashing stores that charge fees for money orders used to pay bills, and pay "exorbitant interest rates to borrow money to make it to the next paycheck," Wollenhaupt reports. Many low-income people who receive federal benefits will have to choose to directly deposit funds into a bank account or to put them on a pre-paid card similar to a debit card, but without a bank.
Mississippi has the highest rate of unbanked households at 16.4 percent, and and Utah has the lowest rate at 1.7 percent. The eight states with the highest rates following Mississippi are Georgia, Kentucky, Texas, Alabama, New Mexico, South Carolina, Arkansas and Tennessee. The District of Columbia ties with Georgia's rate at 12.2 percent. The West and South overwhelmingly have the most states with high rates of unbanked households. (Read more)