Hispanics need greater inclusion in the US banking system, according to experts

Experts from banking and academia agree that the Hispanic population in USA is one of the most vulnerable to the effects of not being banked and they recommended addressing these shortcomings so that they can obtain benefits such as digital banking or better financial planning.

Latino families “They suffer many barriers and make up one of the most vulnerable populations, particularly those who operate in an informal economy, when it comes to accessing the financial system in the United States,” said the researcher at the Urban Institute ideas laboratory, Luisa Godinez, during the Forum ‘The cost of not being banked, building a financial future for Hispanics’, sponsored by JPMorgan Chase, the first bank in the United States

In 2019, 12% of Hispanic households were unbanked, compared to 2.5% of whites, according to the latest survey from the Federal Deposit Insurance Corp. (FDIC).

Among other reasons, this is because it must improve its “trust” in the financial system and “how your information and money are handled”said Florida International University finance professor Robinson Reyes.

Due, “Latinos in the United States are forced to use other services that will charge them extra, for example, for cashing a check” and “does not have access to financial services with which to buy a house or a car,” indicated the vice president and community manager of the bank JPMorgan Chase, Yesenia Quiñones.

Other drawbacks of not having a bank account are the time required to manage paychecks and invoices: “Any transaction involves moving,” added Reyes, “going to the bank, standing in line… therefore, it is a huge advantage to have digital means in which many of the day-to-day payments are made automatically.”

Benefits of being banked

Faced with the general perception that many have Hispanicsthe speakers of the forum – moderated by correspondent Paula Escalada – agreed that having a bank account allows access to resources such as tools to establish and monitor a budget, check the credit score and have greater security, through monitoring services that warn of suspicious activity.

According to Quiñones“having a bank account will open doors to other accesses that they are not currently taking advantage of, such as, for example, savings tools to buy their first home.”

Along these lines, Godinez highlighted the possibility of building a credit history, which is “the first step to being part of the financial system” as well as “building a stable financial asset and having the security that allows them to have an emergency fund for unexpected moments.”

For his part, Professor Reyes highlighted the flexibility that having a bank account offers the individual since they can opt for “financing options and at a scope that goes beyond your current income.”