banking and the poor
An article worth your time.
http://www.economist.com/finance/displaystory.cfm?story_id=6889252
http://www.economist.com/finance/displaystory.cfm?story_id=6889252
posted by hannah at 6:48 AM
Saturday, May 06, 2006
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3 Comments:
Interesting article, Hannah.
"'For banks to rise to the challenge, they must see the unbanked as a sustainable business—not just community development.' In other words, if banks are to go after the unbanked, they will have to see profit in it."
It seems to still be encouraging banks to look at the poor as potential assets, just assuring banks they are more profitable assets than previously thought.
I know that a business must make money and I am not it the business world, but it seems to me that it is possible to have an ethic that treats the poor (and everyone else) with more dignity, and not only as potential sources of income. This just applauds banks for trying to make money off of them. As if being a consumer with a bank account and a bank making money off of you, is the highest level of dignity a human can have.
-Jonathan
Jonathan,
I would have to concur with your scepticism about the benevolence of the banking industry. If there was really that much profitability in providing services for the "unbanked and underbanked" the market for it would have taken off some time ago. I appreciated the article less for its optimism about 7-11 banking centers than for its overview of the problem. The lack of banks in poverty stricken areas is one more example of how resources are in a constant state of flow out of these communities. Check cashing centers are one of the blights on my local landscape and are part of the vicious cycle that those living paycheck to paycheck are sucked into. Naturally, paying bank fees is not the apogee of human dignity. But it might be more dignified than paying a loan shark.
So, how do we change the situation? Are we willing to attempt to legislate where banks put branches and who they must accept as customers?
Check cashing centers are degrading, and fancy banks committing similar usury at a better rate of interest in a nicer building may be “less” degrading, but it is still a prettier form of the same basic rudeness (like “progressives” that slander the people at Wal-Mart for consumerism, while they spend all day shopping for organic foods and Birkenstocks.)
Legislate banks where they put their branches? In theory it doesn't seem any more problematic than plenty of current legislations. But then again, what do we distrust more big business or big government bureaucracy? Neither seems particularly humanizing. (Is our goal to make the poor wealthy or to approach them with dignity? Are these the same thing? If so aren’t we buying into one of the basic fallacies of our society that capital creates human value?) We can help the poor by setting up a "Bureau of Bank Branches" complete with hundreds of new laws, enforcement agents, and large stacks of paperwork the poor people have to fill out each time they open an account.
Perhaps I am a hopeless romantic, but I’m still aspiring for a cultural change in which we don’t see each other as objects of profit, or as social problems to be solved. Perhaps I’m falsely hoping for the “new heavens and new earth” here among fallen men. This is why I would be no good for politics.
As always your thoughts spark interesting ideas I must think on further, Hannah.
-Jonathan
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