The Role of Banks in Addressing the Needs of the Unbanked and Underbanked in Mississippi

July 16th, 2012

At a Mississippi Economic Council event Friday, Dennis Lockhart, the President and CEO of the Atlanta Branch of the Federal Reserve and member of the Federal Open Market Committee gave a speech on the state of the overall economy.

During his comments, he noted that youth, low-income residents and minorities suffer disproportionately from the nation’s economic challenges. Following his statement about the economy and his thoughts on the different actions that the Federal Reserve could take to address a stubborn recovery, HOPE CEO Bill Bynum questioned Mr. Lockhart about the role of banks in addressing the needs of the unbanked and underbanked in Mississippi.

His response was insightful. When individuals are not part of the banking system the ability of monetary policy to improve the overall economy is diminished. The gravity of this insight is not to be overlooked. Another way to interpret the view is that in the absence of an environment that creates opportunities for our most vulnerable residents, our potential as a society to advance the economic recovery is limited and our overall quality of life is not as high as it could be otherwise.

He also spoke about the need for a comprehensive approach to bringing people into the financial mainstream through banks, community development financial institutions, the Federal Reserve and through efforts to promote financial literacy. Like many of the challenges in our state – real solutions requires real collaboration.

Learn more about the unbanked and underbanked here in Mississippi from the report below.