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United Way Suncoast develops program for the underbanked
United Way Suncoast staff is encouraging residents to apply to the initiative before an executive order stops the government from issuing paper checks for most federal payments.
More than 11% of residents in Pinellas, Hillsborough, Manatee, Sarasota and DeSoto counties are underbanked. This means that they often rely on alternative financial services such as check cashing rather than a bank account.
At the end of this month, the U.S. government will cease issuing paper checks for many federal benefit payments (Social Security, Veteran benefits and IRS refunds, et cetera) at the direction of the Trump administration.
Leaders at United Way Suncoast believe this is a challenge, but also an opportunity to help local residents improve their financial health.
The organization’s BankOn Suncoast program can be a viable solution, UWS financial security manager Mark Smith said.
This initiative, which includes a coalition of financial institutions, community-based organizations and local governments, gives residents access to “safe, affordable and certified” accounts so that they can receive federal benefit payments. These accounts have no overdraft fees.
Participating financial institutions include banks and credit unions such as Wells Fargo, PNC and Bank of America.
United Way Suncoast’s BankOn coalition, which was launched in 2018, is part of a national effort led by the Cities for Financial Empowerment Fund. Over 90 BankOn programs have been developed around the country.
All financial institutions involved in the initiative must receive a certification from the Fund, Smith said.
Once Trump’s executive order goes into effect, it can cause issues for individuals who do not have bank accounts or the unbanked, such as the elderly, rural residents and people with intellectual disabilities, according to UWS.
Many of the services unbanked and underbanked individuals use are “costly,” Smith added. However, he said, the change is not all bad.
“You can look at it as a positive too, because we know paper checks are subject to other challenges. There’s a cost obviously on the government side to the taxpayer by issuing these checks.”
Fraud is also a concern. Seniors could be taken advantage of, Smith added.
More importantly, it’s an opportunity to “promote financial security,” he said. People can get educated on why it’s better to use trusted institutions rather than alternative services. Additionally, they can discover that there are options available.
“We can leverage this executive order to help folks get to the next step. We don’t know what’s going to happen after Sept. 30, but we want to be proactive.”
To learn more about the initiative, visit this website.
