Recently I was interviewed for a south American TV network about why so many people in the world don’t have any bank accounts.
Can you believe that there are millions of people across the world who have never had a bank account?
How do they cope, you may ask?
Many of them don’t. It tends to be in the poorest areas that there are the highest numbers of ‘unbanked’ and not having access to proper savings or loans keeps them poor.
Even in the UK, though, there are over 1.5 million without a bank account.
It isn’t necessary here as new rules have made it easier for people to get a bank account. But even if you don’t want one, there are alternatives to bank accounts as well.
Worldwide figures for the ‘unbanked’
- Worldwide, there are 2 billion unbanked individuals. 2.2 billion of the unserved adults live in Africa, Asia, Latin America, and the Middle East.
- In Europe, around 25 million people who would like to have an account, don’t have one. Around 2.5 million who applied for one have been rejected for one reason or another, such as being too poor.
- In the U.S., there are 68 million Americans without access to a bank account or debit card — roughly 22%. In fact 20% of Latinos in the United States don’t use banks
- Close to 80% of Africa’s adult population is unbanked
UK Figures for the ‘unbanked’
- There are 1.5 million unbanked adults in the UK according to Financial Inclusion Annual Monitoring Report in 2015
- In the UK, 65% of ‘unbanked’ households in the lowest three income meaning they have an annual household income of just under £14,500. They are also more likely to be in receipt of benefits
- Half of the unbanked have been receiving benefits for more than five years and they are more likely to live in socially rented accommodation
You can get a basic bank account
There’s no reason why you shouldn’t have a bank account in the UK – at least a basic one (without an overdraft).
Who can get a basic bank account?
- Over 16 – You need to be at least 16 to open a basic bank account, although at some banks the minimum age is 18.
- No minimum monthly payment – Unlike current accounts, basic bank accounts don’t have a minimum amount you have to pay in each month, which can be an advantage if you’re on a low income.
- No need for a good credit history – Because basic bank accounts don’t allow you to go overdrawn, you don’t need to pass a credit check when you open the account.
- Proof of identity and address – All banks will ask for proof of your identity and address before you can open a bank account.
For tips on how to improve your chances of being allowed a bank account with the High Street banks, there is further information on the Money Advice Service site .