Underserved Americans & Holidays

December 9, 2011

The holidays can be difficult for many. And in times of financial uncertainties about having enough money to cover gift-giving expenses can be a source of a lot of anxiety. So imagine being unbanked and dealing with these uncertainties.

"With the holidays almost here, unbanked and underbanked Americans are feeling extra financial pressure and anxiety about having enough money to pay for gifts," said the developers of the first-ever Underbanked Financial Sentiment Index, which was unveiled last month.

More than half of those surveyed (56%) said they didn't have enough money set aside to cover holiday expenses and 59% said the financial pressures of the holiday season made them wish they could skip the holidays altogether, according to Think Finance, a Texas-based company that sponsored the study. Think Finance develops online lending products for the unbanked and financially underserved. In October, for example, the company unveiled a program it calls Presta to support online lease-purchase agreements.

"Many of us feel financial stress around the holidays, but for those who are already struggling, this can be a particularly difficult time of the year," said Ken Rees, CEO of Think Finance. "Underbanked and unbanked consumers trying to keep up with holiday expenses need flexible, innovative financial products to help them manage through times like these," Rees added.

The dreary outlook on holiday spending was reinforced by several additional findings.

• 34% of unbanked and underbanked Americans said they are barely getting by, financially
• 39% described themselves as financially stretched but managing to pay for necessities
• 77% have cut back on spending because they couldn't stretch their incomes to meet expenses

Here's what's keeping these folks awake at night.

• 35% of the underserved worry about paying for basic necessities
• 28% are concerned they don't have enough money set aside for emergencies
• 26% worry about paying down outstanding debts

The Underbanked Financial Sentiment Index draws on results of a survey of 500 adult Americans earning less than $50,000 a year who rely on non-bank financial services. It was conducted in October.

One in four people, worldwide, survive on less than $1.25 a day