- Stringer 2013 -

Mariela Lombard for News

Dawn Carrillo, Banco Popular’s vice president for New York Marketing, says opening an account is the first step toward financial security. At left, a brochure for Bank On program.

They're called "the unbanked."

Nearly 100,000 low-income New Yorkers have no checking or savings accounts - and residents of Harlem, Washington Heights and Inwood make up the majority of them.

That is starting to change as the one-year anniversary approaches tomorrow of Bank On Manhattan, an innovative program that allows people to open checking accounts with just $25, have a minimum balance of $0.01 and monthly fees ranging from zero to $6.

More than 7,000 Manhattanites have opened up Bank On accounts as of January, with 3,000 more expected when first year totals are released this fall.

"New Yorkers without accounts spend $198 million annually on check-cashing fees and money orders" in bodegas and other locations, said Manhattan Borough President Scott Stringer, who initiated the program last year in partnership with the New York Federal Reserve Bank and the FDIC.

"That translates to an average of $530 per person - money which could be better spent on savings, food, clothing, almost anything else."

The novel program began in San Francisco in 2006 and has now spread to 56 cities in six states.

Given the success in Manhattan, Bank On will be moving on to Queens, according to state Sen. José Peralta (D-Jackson Heights). Starting in September, participating banks will begin to train their branch staffs there about the program.

Customers typically include students, minimum-wage workers and folks who have fallen on hard times and are getting reestablished.

Once they open a Bank On checking account, they are also hooked up with community organizations - such as the Harlem Commonwealth - which offer financial literacy workshops.

"Having a bank account is probably the first and most important step toward financial security," said Banco Popular's vice president for New York marketing, Dawn Carrillo, in an interview at the bank's Washington Heights branch.

"It's through public/private partnerships like this we can reach out further into the community and make a difference in the neighborhoods we serve."

Banks, typically not known for their philanthropy, have gotten on board for several reasons: to be a good neighbor, to access new customers and to remain in good standing with the FDIC, which audits banks' "community reinvestment" efforts.

It's a win-win for customers who have either had a bad experience - or no experience - with a traditional bank before.

"Many of the unbanked have misperceptions that if they made a mistake in the past - like overdrawing a checking account or bad credit - they are out of the game," said Carrillo.

"The Bank On Manhattan program allows them a second chance as long as there has never been outright fraud, and gives them access to a bank and a community partner they can trust."

Regulated by feds &  overseen  by community groups

Some facts about Bank On Manhattan:

• In Washington Heights and Inwood, 33,000 people, or 46% of the population, do not have bank accounts.
• In Harlem, 51,000 households, or 36%, go without accounts.
• Participating banks include Amalgamated Bank, Banco Popular, CheckSpring Bank, Citibank, East West Bank, Emigrant Savings Bank-Manhattan, TD Bank and Union Settlement FCU.
• Bank On is regulated by the Federal Reserve Bank of New York, FDIC and the New York State Banking Department, and is overseen by nonprofit community organizations.
• Account holders do not have to possess U.S. government IDs; at least one form of foreign ID is acceptable.