Are you underserved? If you don’t know the answer, you might be.
Roughly 17 million Americans don’t have a bank account with any of the major banks. Another 43 million people have one, but their credit is so rocky that they can’t borrow money.
Being underserved means you don’t have access to a full selection of traditional financial services. But it doesn’t mean you can’t participate in the financial world. The underserved have a chance at unlocking more products through digital alternatives.
Let’s take a look at two ways you can boost your finances online.
1. Cash into Mobile Payments
A cash-free future is only a few years away in some parts of the world, but the U.S. is a little slower to adopt cashless technology.
That doesn’t mean the switch isn’t already happening. Some of the country’s biggest retailers are campaigning for cash-free stores.
Have you heard of Amazon Go? It’s probably the most famous example. But Starbucks is piloting a cashless location in Seattle, and there are other stores doing the same.
These stores rely on digital payment systems. Unfortunately, many of these systems rely on an account at a major bank, putting the underserved at a disadvantage.
Luckily, someone without a typical checking account still has ways to tap into digital payments.
No-fee mobile banks
There are some online banks available that remove many of the costs that prevent the underserved from opening basic checking and savings accounts. They don’t charge monthly fees or expect you to keep a minimum balance. Yet these accounts sync with digital payment systems you need.
Services that digitize cash
Some of the country’s largest retailers are making it possible to top up online spending accounts without going online. Amazon, Walmart, and PayPal have specific retail locations where cashiers upload cash onto online accounts on behalf of customers. Amazon also just opened a Go location in New York City that accepts cash to keep up with the state’s legislation.
2. Build Your Credit Score Online
Establishing credit is a challenge when you’re underserved because you may not have access to products that contribute to your score.
Why? Well, to put it bluntly, the biggest banks don’t like you.
Sure, they may think you’re a swell person. But that’s not the problem. Something in your financial history raises a red flag.
If they see you have a subprime score, they may not issue you a loan or line of credit. Unfortunately, that line of credit could be instrumental in raising your credit score.
Luckily, there are online lines of credit available to people with subprime scores.
You can secure and pay off a line of credit entirely online, so you don’t need access to a local brick-and-mortar branch. Instead, you can access your online of credit anywhere you have Wi-Fi.
Just make sure you choose an online line of credit that reports to the major credit agencies, like a CreditFresh Line of Credit by CBW Bank. This way, your payment history will have an impact on your score if you get financial support from CreditFresh — giving you the opportunity to build your credit as long as you pay on time.
Establishing credit this way comes with added perks, including:
- A financial safety net you can tap into whenever you need help paying for an unexpected expense
- Access to more money and lower rates over time if you consistently pay on time
Bottom Line: Digital Alternatives Give You Options
It’s not always easy participating in the financial world when you’re underserved. But it’s possible. Digital alternatives are making it easier than ever to tap into a greater selection of options. Check them out to see if they fit your finances.