The U.S. Treasury recently unveiled its National Strategy for Financial Inclusion. It’s packed with practical ideas to remove barriers to financial health and wealth-building.
Here’s a snapshot of the key strategies Treasury proposes to improve financial inclusion:
1️⃣ Better Transaction Accounts and Payments:
▶️ Lower fees and reduced minimum balance requirements for checking and savings accounts.
▶️ Faster access to funds (real-time settlement and payments to avoid penalties and late fees).
▶️ Language accessibility for non-English speakers.
▶️ Read-only account access for those needing financial assistance.
▶️ Mobile banking branches for activities requiring in-person access (e.g., cash deposits).
2️⃣ Smarter Credit Underwriting:
▶️ Incorporating cash flow data, rental history, and utility/telecom payments to improve credit assessments.
▶️ Open banking rules to make switching banks easier and spur innovation in financial products.
3️⃣ Improved Restructuring and Forbearance Options:
▶️ Enhanced loan restructuring options to adjust payment terms, reduce interest rates, or extend repayment periods during financial hardships.
▶️ Short-term pauses on adverse credit reporting to credit bureaus during declared emergencies, such as natural disasters and pandemics.
4️⃣ Stronger Incentives for Savings:
▶️ Retirement accounts with features like automatic enrollment and limited penalty-free withdrawals for emergencies.
▶️ Rainy day funds designed to help individuals save specifically for emergencies, often linked to payroll deductions or account nudges to make saving easy and consistent.
▶️ Child savings accounts to build wealth from a young age.
5️⃣ Reduced Government Friction:
▶️ Simplified identity verification using municipal IDs, student IDs, and attestation letters to increase accessibility.
▶️ Streamlined processes for accessing tax credits and subsidies, like childcare and home energy assistance, by cutting red tape and reducing the burden of forms and documentation.
▶️ Free or low-cost tax filing options to make navigating tax season more affordable and straightforward.
These are common-sense strategies to remove barriers that keep millions of Americans from building wealth and achieving financial security.
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