Why Don’t Poor People Have Bank Accounts?

Richard A. Moran
Aug 8, 2018 · 3 min read
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I was a junior partner at a big consulting firm. The team was meeting with the CEO of a large bank and we were making the pitch for new business. We had our big Power Point presentation ready to go. The presentation was full of Gantt Charts, flow diagrams, Venn Diagrams, and all other manner of models. The deck might have included flux capacitors. We were ready to explore assessment, analysis and recommendations. Before we could even turn the projector on, the CEO stopped us and said…

“I have a question for you. I know you are all smart and can make lots of recommendations based on your analysis, so here is my question: Why don’t poor people have bank accounts?”

At first, I thought it was a trick question to throw us off before the real presentation. But it wasn’t. I thought to myself, “They don’t have bank accounts because they don’t have any money”. I never said it out loud and I was glad I didn’t.

The bank CEO continued, “I don’t need to see your Power Point, I am sure it is fine. Go see if you can find some good answers to my simple question.” And with that, off we went.

At this point in the post I could go into all kinds of analytical tools that we used to come up with answers but that doesn’t matter. And there are many factors that are part of the equation including cultural background, geography, race and education to name a few. But the biggest finding and the one that matters most is that the simple question had a simple answer. The answer is, poor people don’t have bank accounts because they don’t or won’t go into banks.

Yep, at the time, poor people did not go into banks because the facilities, the locations, the staff, the parking, the forms were all just too intimidating for a person with modest means. The CEO who asked the original question had a suspicion that was the case and we validated it. The solution? Open bank branches in “other” spaces like in grocery stores or other retail outlets. And poor people opened bank accounts.

I am not taking credit for disrupting the banking industry. I am bringing attention to two key points:

  • First, never make broad assumptions about any group of people. The banking industry had made assumptions that people with modest means did not want or need a bank. It was incorrect. Everyone wants and needs credit cards and checking and savings accounts and the like. So ask yourself, is your organization making broad assumptions about customers or employees or partners? You may be surprised.
  • Second, the really basic organizational questions need to be posed constantly. Questions like: Is there a better way to do what we have been doing for so long? Can we disrupt our own business? Can we change this ingrained culture? Can we get our people to change? Can we serve customers better? Again, you may be surprised.

The world is full of stories of positive changes that occurred when people asked the most basic questions and created challenges. Ask more questions.

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