The following testimony was presented to the United States Senate Committee on Banking, Housing, and Urban Affairs on February 5, 2025. You can watch video of the hearing here.
Chairman Scott, Ranking Member Warren, and members of the Banking, Housing, and Urban Affairs Committee, thank you for the opportunity to testify on the consequences of debanking in America. I commend the Committee for focusing on this real and pressing problem. Access to a bank account is a prerequisite to full participation in America’s economy. Barriers to having a bank account for consumers and businesses have to be identified and lowered. This is an issue I have spent years researching, analyzing, and working on during my tenure in public service, including the honor and privilege of working for this Committee for over eight years.
My testimony explains several factors that have driven debanking, with a focus on individuals. I then look at the progress that has been made in bringing people into the banking system, then conclude with policy recommendations for the new administration, financial regulators, the financial services industry, and Congress to tackle debanking and increase financial inclusion.
If I can leave you with just one takeaway from today, it is this: The best way to combat debanking is to bring people and businesses into the banking system by lowering costs for basic accounts, reforming outdated regulations that hinder access, and creating better services that meet the needs of those living paycheck to paycheck.
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Acknowledgements and disclosures
The author would like to thank Aidan Kane for his invaluable research assistance in creating this testimony.
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Commentary
TestimonyInvestigating the real impacts of debanking in America
February 13, 2025