Industry Letter to Highlight Bank On Manhattan Initiative
October 6, 2010
To Financial Institutions
The New York State Banking Department (Department) is taking this opportunity to alert institutions to a new and important program being launched by the Manhattan Borough President’s Office – the Bank On Manhattan initiative. Bank On Manhattan (or, for Spanish-speaking New Yorkers, Cuenta Con Manhattan), is a partnership of retail banks, community groups, regulatory agencies, and Borough President Scott Stringer’s office designed to help Manhattan’s unbanked families open basic checking accounts.
The Department is a proud participant in this partnership which seeks to assist the 95,000 households in the borough of Manhattan Participating financial institutions may offer this basic checking account at all branches notwithstanding their location outside of the borough of Manhattan. that have no bank account. On average, these Manhattan families spend $530 every year on check cashing fees, bill payments, and money orders, putting an even greater strain on their ability to make ends meet during these tough economic times. A secondary, but equally significant cost of being unbanked, is that families miss the opportunity to accumulate assets and build the banking history essential to prosperity and financial success. Finally, without a bank account it is harder for them to keep their money safe and easier to become a victim of robbery or theft.
The Department encourages its depository financial institutions to take advantage of this opportunity to participate in the Bank On Manhattan initiative. Becoming a Bank On Manhattan Financial Partner allows financial institutions to become stewards in their communities, reach new markets, forge ties with community groups, and earn CRA credits. In order to join the coalition, financial institutions must offer a product that meets the following baseline criteria:
Minimum Opening Deposit: $25 or less
Minimum Balance to Maintain Account: $0.01
Monthly Fee: Between $0 - $6
Primary IDs: Accept at least one form of foreign ID
Second Chance Accounts: Prospective Bank On Manhattan customers cannot be disqualified on the basis of ChexSystem records over 2 years old (excluding fraud and unpaid closures). For those with ChexSystem records less than 1 year old, financial institutions may require financial education courses as a precondition of obtaining a Bank On account, which would be provided by nonprofit organizations partnering in this initiative.
Additionally, participating institutions must be willing to tag and track all accounts opened via this initiative.
All New York State chartered depository institutions already offer accounts with most of these features because of the Basic Banking Account requirement. Thus, only a few changes may need to be made to those basic accounts to qualify as a Bank On Manhattan Financial Partner.
The Department encourages all depository institutions that are not yet participating in this initiative to do so. The benefits to both your institution and the unbanked community are great.
For more information on how to become a financial partner please contact the Department’s Deputy Superintendent for the Consumer Services Division, Dianne E. Dixon at 212-709-3591, or the Manhattan Borough President’s Policy Analyst, Shira Gans at 212-669-2206.
Thank you for your cooperation.
Richard H. Neiman
Superintendent of Banks
New York State Banking Department