A study by Upgraded Points, the site for maximizing banking and travel points, shows that even as online banking has brought a new level of convenience for banking customers, many of America’s most vulnerable populations. they still rely on physical locations for their banking needs.
“In particular, low-income households (those with less than $15,000 in annual income), households without a high school degree, and older households are much more likely to rely on traditional banks. These households will suffer the most due to the decrease in the number of traditional bank branches,” the report says.
According to Upgraded Points, reliance on traditional banking also varies by location, with states like Oregon, Arizona and Florida, whose populations include large concentrations of people 65 and older, being among the states with the most households using traditional banking.
Other states that have low rates of computer and Internet access, such as North Dakota and Iowa, are also among the states that rely the most on traditional banking.
In contrast, Georgia (76.4%), Alaska (76.4%) and Louisiana (76.7%) have the lowest proportion of households using traditional banks.
According to the study, the number of physical bank branches peaked in 2011 at just over 105,000 and has been steadily declining ever since. In 2021, there were fewer than 94,000 physical bank branches nationwide.
Fewer branches can mean longer wait times for those who rely on bank branches that remain open. For some, this may mean having to spend more time on daily obligations, such as work or childcare.
States where people depend on traditional banking services:
State: (1) Oregon
Households that use traditional banks: 88.0%
Households that only use traditional banks: 5.2%
Households with a bank account: 98.4%
Total Population by Bank Branch: 3,708
State: (2) Utah
Households that use traditional banks: 85.3%
Households that only use traditional banks: 3.3%
Households with a bank account: 98.8%
Total Population by Bank Branch: 3,514
State: (3) Kansas
Households that use traditional banks: 85.2%
Households that only use traditional banks: 6.6%
Households with a bank account: 96.2%
Total Population by Bank Branch: 2,174
State: (4) Iowa
Households that use traditional banks: 85.1%
Households that only use traditional banks: 9.6%
Households with a bank account: 97.0%
Total Population by Bank Branch: 2,105
State: (5) North Dakota
Households that use traditional banks: 84.5%
Households that only use traditional banks: 8.8%
Households with a bank account: 96.8%
Total Population by Bank Branch: 1,734
In counterpart:
State: (46) New Hampshire
Households that use traditional banks: 78.0%
Households that only use traditional banks: 8.3%
Households with a bank account: 98.6%
Total Population by Bank Branch: 3,675
State: (47) Rhode Island
Households that use traditional banks: 77.9%
Households that only use traditional banks: 15.0%
Households with a bank account: 96.5%
Total Population by Bank Branch: 3,955
State: (48) Louisiana
Households that use traditional banks: 76.7%
Households that only use traditional banks: 15.4%
Households with a bank account: 91.9%
Total Population by Bank Branch: 2,851
State: (49) Alaska
Households that use traditional banks: 76.4%
Households that only use traditional banks: 8.6%
Households with a bank account: 95.2%
Total Population by Bank Branch: 3,877
State: (50) Georgia
Households that use traditional banks: 76.4%
Households that only use traditional banks: 10.8%
Households with a bank account: 93.3%
Total Population by Bank Branch: 4,332
To see the full report and details on the methodology, go here.
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