Study Finds That Almost One-Quarter of Unbanked Consumers Use Credit Cards

Scarborough Research, the leading market research firm for identifying the shopping, media and lifestyle patterns of adults in the United States, released an analysis of “Unbanked” consumers — adults who do not make use of any bank or financial institution in their household. The analysis finds that almost one-quarter (22 percent) of the Unbanked used a credit card during the past three months. VISA is the preferred brand. Thirteen percent, or nearly 1.3 million Unbanked consumers — used a VISA card during the past three months.

In total, five percent, or more than 10.2 million consumers nationally, are Unbanked. These consumers are more likely than all adults to be young (46 percent more likely to be ages 18-24), single (52 percent more likely than all adults to be single) and in lower income brackets (more than twice as likely to have an annual household income of $35k or less). Unbanked consumers are also more than twice as likely to be either black or Hispanic.

“The Unbanked are young, tend to be ethnic and just starting out. Credit cards are an important transaction option as they do not have basic financial services, like checking accounts, established yet,” said Karla Horton, manager, advertiser marketing services, Scarborough Research. “Credit card companies aggressively target the younger age group. Often, credit card applications are widely available on college campuses and in malls. Banks and credit card brands who establish relationships with these younger consumers may have an advantage when they are ready to begin using other financial services.”

Ms. Horton and a team of Scarborough analysts will present more insights on the Unbanked as well as about consumer banking trends in general during free webinars taking place March 16 and March 23. To register, log on to http://www.scarborough.com/banking.php or by calling Tricia Lewis at 310-824-6616, email tricia.lewis@arbitron.com.