The unbanked and underbanked may be disproprotionately rural. Some who have forsaken banks are irritated over banking charges, including overdraft fees that cost customers $31.6 billion last year, and others are spurred by the financial crisis and a loss of confidence in traditional institutions.
The fastest growing type of nontraditional banking is prepaid debit cards offered by NetSpend and Green Dot Corp. Customers can buy cards at grocery stores and load money onto them to pay for "a wide variety of purchases -- just as they would do with a regular credit or debit card," Fields and Jackson-Randall report. But, customers must buy the card and pay a monthly fee to keep it. (Read more)