New America Foundation Commends LA City Councilman Richard Alarcón's Banking Development District Initiative

LOS ANGELES, CA - Los Angeles City Councilman Richard Alarcón today announced the launch of a Banking Development District Initiative in Los Angeles. The act was inspired by New York State's Banking Development District program and uses state and local deposits to encourage banks to open branches in lower-income neighborhoods and develop products and services tailored to local residents.  
 
"We applaud Councilman Alarcón's leadership in advancing a proven way to connect lower-income unbanked Californians with the financial products and services they need to enter the financial mainstream and begin to build savings and assets," said Olivia Calderon, California Legislative Director of the Asset Building Program at the New America Foundation. 
 
Today, approximately 12 percent of households statewide are unbanked—meaning they don't have a simple checking or savings account. Recent research indicates that Los Angeles has the third highest percentage of unbanked residents in the country—with about 300,000 households disconnected from the financial mainstream.
 
"Too many people are living outside the financial mainstream, vulnerable to burglaries or alternative outlets that charge them exorbitant fees to do something as simple as cash their paycheck," said Calderon. "If banks build branches in their communities and then reach out to them, people will save and communities will prosper."

New America's Asset Building Program has long called for the creation of banking development districts. In 2007, the New America Foundation sponsored Assembly Bill 1502 in California to create a Banking Development District statewide program, intended to spur increased and enhanced banking services in under-served communities.

About the California Asset Building Program
The purpose of New America's Asset Building Program, established in 2002, is to significantly broaden savings and assets ownership in America, thereby providing all Americans both with the means to get ahead and with a direct stake in the overall success of our economy. This major, new direction in public policy promises to be as successful in the 21st century as the Homestead Act and GI Bill were in previous centuries.

About the New America Foundation
The New America Foundation is a nonprofit, nonpartisan public policy institute that invests in new thinkers and new ideas to address the next generation of challenges facing the United States.
 

Learn More About: Olivia Calderon
Related Programs: New America in California, California Asset Building
Topics: Ownership & Assets