Many of us don’t think twice about the luxuries modern bank accounts offer — direct deposit of paychecks, using debit cards to take out cash any time, conducting online money transfers, quickly securing bank loans. The list goes on.

Imagine being locked out of that mainstream system, without access to everyday conveniences that are affordable and position you for financial stability and growth. Unfortunately, that’s the reality for many Americans, classified as unbanked or underbanked.

The Federal Deposit Insurance Corp. estimated that in 2013, roughly 7 percent of U.S. households — more than 25 million people — had neither a checking nor a savings account. In Maine, about 20 percent of households were unbanked or underbanked.

What does it mean to lack access to traditional financial services? It means waiting in check-cashing lines and unnecessarily paying significant fees. It means carrying cash at all times. It means that getting a home or car loan is not an option. At the end of the day, those who need financial advantages most are prevented from the very tools that facilitate financial progress.

Not only does a lack of banking hold back families, but, for many, it also leads to greater debt. When urgent financial needs arise — for which many of us can charge a credit card or secure a bank loan — the unbanked are all too often at the mercy of payday lenders. Short-term payday loans can have interest rates in the triple digits, compounding the financial problems of people who already are struggling.

It is true that there are signs of economic growth everywhere. Our federal budget deficit and unemployment rate are at six-year lows, and consumer confidence has reached its highest level in seven years. But while these trends are good news for some, another trend unfortunately speaks poorly for those in the lower income brackets: the growing income gap.


In 2013, the Pew Research Center reported that inequality was at its highest since 1928. As noted in a 2014 Press Herald article, Maine’s income gap grew during the Great Recession, despite faring better than many other states. The percentage of Maine residents living below the federal poverty line has also increased: from 11.1 percent in 2002 to 14.7 percent in 2013, according to U.S. Census numbers.

Having grown up in Gray without many resources, I understand all too well how the odds can be stacked against those who don’t have much to begin with. Fortunately, there has been one major change since my younger years: technology. As we consider how to address the needs of those without access to bank accounts, the mobile phone has emerged as a prime solution.

Long passed are the days when mobile phones were reserved for the rich and high-powered. According to the Pew Research Center, 90 percent of American adults report having a cellphone, with 58 percent carrying a smartphone. Worldwide, 2 billion people have mobile phones but not bank accounts.

With mobile phones being accessible to so many, we have to think of them as a tool for delivering access to traditional banking. After all, the prevalence of mobile technology might be one of the only trends working in favor of the less fortunate.

As an article in The Boston Globe recently noted, many banks are jumping on the mobile banking bandwagon, in which users can complete financial transactions from their phones. This trend, which was more than likely born out of convenience, is something that has the potential to unlock financial freedom for individuals around the world.

Many experts wonder whether rapidly advancing technology is good or bad for our economy. From my perspective, it’s what we make of it. If we start using the mobile phone to bring traditional banking services to those without access, it will benefit them and our entire economy.

A lot stands in the way of upward mobility, or even achieving a sense of economic security. In the age of rapidly increasing technology, access to banking shouldn’t be contributing to such problems. Making mobile banking available for the unbanked and underbanked will bring greater financial freedoms to these individuals and their families — financial freedoms that many of us take for granted.

Michael Liberty is founder of the Gray-based Liberty Family Foundation and Mozido Inc., an Austin, Texas, company that develops cloud-based mobile payment systems.

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