Pledging to accelerate unbanked individuals’ access to affordable mainstream accounts and to address long-standing inequities, Wells Fargo & Company last month launched a 10-year commitment dubbed the Banking Inclusion Initiative. The financial services company will focus on Black and African Americans, Hispanics, and Native American/Alaska Native families.
Together, the target audiences account for more than half the country’s 7 million+ unbanked households. Assistance is also promised to those who are underbanked and underserved, who may have a bank account yet still use high-cost, non-bank services.
Wells Fargo plans to bring together a “broad and diverse group of national and community stakeholders to address long-standing inequities by increasing access to digitally-enabled transactional accounts and financial health coaching.” As part of its promise, the company will collaborate with partners to explore solutions to the credit challenges facing unbanked individuals.
Among specific actions it will implement are:
- Deepening its existing relationships with Black-owned minority depository institutions (MDIs) to support their work in the communities they serve. To date, Wells Fargo has invested in 11 MDIs whose customers will be able to use WFC’s nationwide ATM network without incurring fees. (Editor’s note: no MDIs in Washington state are on that initial list.)
- Continuing to recognize that unbanked and underbanked individuals need access to short-term credit. Wells Fargo is increasing funding and support to expand the Credit Builders Alliance (CBA) low-cost, credit-building consumer loan program to help low- to moderate-income (LMI) individuals meet short-term cash needs and establish or improve their credit scores.
- Increasing awareness and outreach about low-cost, no overdraft fee accounts, including ones designed for those who are new to banking or have encountered past challenges opening or keeping a bank account.
- Broadening collaborations with the Cities for Financial Empowerment (CFE) Fund and its local Bank On coalitions to pilot new strategies to help those who are unbanked navigate the financial system.
- Working closely with fintechs (financial technology used to integrate, automate, and improve financial services) that are deeply committed to helping underserved communities.
Wells Fargo claims to serve one in three U.S. households and is an investor in Greenwood, a Black owned digital mobile platform for Black and Latino individuals and business owners. Since its unveiling in October 2020, Greenwood has a waitlist of more than 550,000 community members.
Improving access to financial education and advice is also a priority of the Banking Inclusion Initiative. Teaming with Operation HOPE (whose focus is financial dignity and inclusion) and partnering with the Historically Black Colleges and Universities (HBCUs) Community Development Action Coalition, and introducing a new program within LMI neighborhood branches to help build trust among unbanked individuals are among ways Wells Fargo plans to boost access.
“With branches in more communities than any other financial institution, we have a responsibility to do even more to address this issue, and the pandemic has increased the urgency,” stated Mary Mack, Wells Fargo’s CEO of Consumer and Small Business Banking.