The Bank Policy Institute, American Bankers Association, and Consumer Bankers Association have submitted recommendations to the U.S. Department of Treasury. These suggestions aim to assist in formulating a nationwide strategy for financial inclusion. This initiative comes as more consumers than ever have access to banking services, with banks investing significantly in various activities to meet consumer needs.

"“Banks are committed to making financial services accessible to all Americans and value the opportunity to partner with regulators to identify opportunities to overcome barriers to achieve that goal,” stated the Associations. “A national financial inclusion strategy should acknowledge the substantial industry contributions already underway and support these efforts by proactively addressing regulatory obstacles impeding future progress.”"

The associations highlighted several initiatives aimed at expanding financial accessibility. These include providing low-cost transaction accounts through programs like "Bank On," investing in Community Development Financial Institutions and Minority Depository Institutions, supporting small and minority-owned businesses through capital investments, partnering with state and local governments via projects such as Project REACh, and enhancing fund availability through real-time payments.

However, they expressed concerns about certain regulatory actions that could hinder these efforts. They pointed out issues such as increased capital requirements under Basel III potentially restricting lending abilities, price caps on debit card interchange revenue impacting bank investments in low-cost checking accounts, reduced incentives for timely credit card payments due to changes in late fee regulations, stigmatization of valued banking services like overdraft fees, and the lack of regulation for nonbanks involved in financial services.

The Financial Services and General Government Appropriations Act of 2023 mandates the Department of Treasury to develop a national strategy for financial inclusion. The department issued a request for information last December with comments due by February 20, 2024.

The Bank Policy Institute represents leading banks across the nation, including universal banks and major foreign banks operating in the U.S., employing nearly two million people. The American Bankers Association speaks for the $23.4 trillion banking industry which employs approximately 2.1 million individuals. Meanwhile, the Consumer Bankers Association advocates for retail banks that create around 1.7 million jobs in America.

For further information or inquiries:

Austin Anton

Bank Policy Institute

austin.anton@bpi.com