Outside the banking system: a review of households without a current account

Authors: Elaine Kempson
Funded by: Social Security Advisory Committee
Published by: HMSO
Publication date: 1994
Report number: Research Paper 6
ISBN: 0117621307

Access to banking facilities is taken for granted by most of us as we manage our financial affairs. It is more a question of which facility to use cheque, cash card, direct debit card, credit card, or to set up direct debit or standing order arrangements for regular bills. But there is a significant minority of households who operate their household budgets outside the banking system and therefore have no access to the facilities that others take for granted.

Combining desk research and secondary analysis of two data sets (one qualitative, one quantitative), this report identifies the characteristics of households which do not have a current bank or building society account, and explores the reasons why people do not have a current account. It assesses the impact on budgeting and money management in households without a current account or access to banking facilities; in addition, it assesses the potential impact on the work of the Department of Social Security and Benefits Agency of claimants having a current account and access to banking facilities. The provision of banking services to low-income families in other countries is investigated, and finally the feasibility and economics of providing banking services to low-income households in the UK is examined.

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