A report published by the Office of the Inspector General (OIG) of the U.S. Postal Service revealed that more than a quarter of Americans, about 69 million people, are underserved and do not have access to banking services such as checking or savings accounts as there are almost no banks or bank branches in their neighbourhoods.
On average, these underserved households spent an equivalent of their annual expenditure on food, about US$2,412, on interest and fees for non-bank financial services such as payday loans and check cashing alone. That amount equates to roughly 10 percent of their average annual household income, recording a national total of about US$89 billion in 2012.
This is one of the reasons people get trapped at the bottom of the economic ladder but it could change soon.
The OIG is exploring a new way to tackle this problem by partnering USPS with banks to offer affordable basic banking services as such bill paying, check cashing, small loans to the underserved households.
Read the full article written by Elizabeth Warren published on The Huffington Post here.