By Director Anita Fox
Michigan Department of Insurance and Financial Services
Governor Whitmer has proclaimed February as Black History Month in Michigan and, during this month, we honor the triumphs and acknowledge the struggles of Black Americans throughout our nation’s history. Black History Month gives us an opportunity to recognize, become more familiar with, and appreciate the contributions that Black Americans have made that impact our lives. Perhaps even more importantly, Black History Month highlights the need to build a just and equitable society for all Americans.
In my role as Director of the state agency that regulates the financial services and insurance industries here in Michigan, meeting the needs of underserved communities is especially important to me.
There is a significant, and visible, overlap between populations without bank or credit union accounts and communities of color, both nationwide and in Michigan. Approximately 5% of American households do not have an account with a bank or credit union, but for Black Americans that number is more than double, over 11%. In Detroit, a predominantly Black city, nearly a quarter of households do not have a bank or credit union account. People who do not have these accounts must rely on costly alternative financial services like check cashers, payday lenders, and pawn shops for routine financial transactions. Overall, Michiganders without an account at a bank or credit union spend an average of $3,000 per year on fees for these alternative services. As a result, these households are significantly less likely to be able to save for emergencies or for their future needs, including retirement. This burden is borne disproportionally by communities of color.
One of the most important steps the Michigan Department of Insurance and Financial Services (DIFS) has taken toward easing this burden is to establish the Michigan Open Account Coalition, or MOAC. Coming out of a partnership between DIFS, the Michigan Bankers Association, the Michigan Credit Union League, and other community organizations, MOAC enables individuals to get a certified no- or low-fee account at one of nearly 30 banks and credit unions. These accounts are easy to understand, user-friendly, and have no surprise or hidden fees. They enable Michiganders who do not have an account with a bank or credit union to have access to services like direct deposit, debit cards, and online bill pay.
Perhaps most importantly, MOAC accounts offer an opportunity to build a relationship with a financial institution, which can help participants secure financial services like auto and home loans, a vital step toward financial security for themselves and their families. For more information on the MOAC, and to find a certified low- or no-cost bank or credit union account option near you, visit Michigan.gov/DIFSOpenAccount.
It is important that we continue to work together to clear barriers and build a state where every person has equal access to the vital financial and insurance services they need. Much has been achieved, but more is required. At DIFS, we affirm our commitment to these values as we work towards greater diversity, inclusion, and equity within the insurance and financial sectors, and as we strive to attract, retain, and nurture a more diverse and inclusive workforce within DIFS and in these industries. We will continue to work toward the goal of ensuring equal opportunities and an inclusive environment for all Michiganders.
