Millions of Americans are expecting to receive their stimulus payments via direct deposit this week as part of the CARES Act signed by President Trump on March 27.
Although the IRS set up a free online tool called Get My Payment allows individuals to provide their direct deposit information, nearly 6.5 percent, or eight million, households in the U.S. do not have a bank account and may have to wait months to receive their paper check in the mail.
Fortunately, families in Arkansas are able to receive support from a local initiative, Bank On Arkansas+, which was formed in November 2018 by the Arkansas Asset Funders Network to help residents set up safe and affordable bank accounts so that they will be able to save money, build wealth and improve quality of life in their communities.
According to the most recent Federal Deposit Insurance Corporation (FDIC) survey of unbanked and underbanked households, 7.5 percent of Arkansans were unbanked in 2017.
“Since we formed Bank On Arkansas+ in 2018, we have focused on engaging Arkansans who still receive paper checks and are potentially unbanked,” said Kara Wilkins, the initiative’s director. “In the face of COVID-19, this has become an urgent need, and we are grateful to our participating banks and credit unions for providing economic relief for struggling families.”
With the help of participating Bank On Arkansas+ financial institutions – Bank of America, Diamond Lake Federal Credit Union, IBERIABANK, First Security Bank, US Bank, Simmons Bank, Southern Bancorp, Citizens Bank, Wells Fargo and Centennial Bank – individuals can open checking accounts, either online or in person by appointment, that have no overdraft fees; a free debit or prepaid card; monthly minimum fee of $5 or less; and allow direct deposit.
“Many people cite distrust of financial institutions as a reason why they don’t have bank accounts,” Wilkins explained. “We want to help build trust between individuals and financial institutions by offering free safe and affordable accounts as well as increase access to banking services for the underserved.”
Bank On Arkansas+ has formed partnerships with municipal officials; city, state, and federal agencies; financial institutions; and community organizations that work to improve the financial stability of Arkansans. “Over 4,000 Bank On accounts have been opened in Arkansas since we first launched in 2018” Wilkins said.
In mid-February, the City of Little Rock contacted Bank On Arkansas+ about offices potentially shutting down due to COVID-19 and the issue of how employees would be able to receive their paychecks. “There were about 200 employees who preferred to pick up their checks in person, so we worked with the City of LIttle Rock to help those employees set up a bank account for direct deposit in March,” said Wilkins.
Wilkins also mentioned future plans for the City of Little Rock. Bank On Arkansas+ will provide financial literacy and education for individuals who work for the City of Little Rock at monthly training and onboarding sessions. Furthermore, the initiative hopes to teach students through the Department of Youth Services about financial literacy.
Visit bankonar.org for more information about the initiative.
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