Direct Express® is one way the Department of the Treasury’s Bureau of the Fiscal Service works to financially empower Americans. More than 3.6 million Americans use their Direct Express® card to receive their government benefits because it’s convenient, safe, and secure. Direct Express® also gives them tools and information to fully participate in a modern digital economy.
More than 70 percent of Direct Express® cardholders currently do not have a checking or savings account. Direct Express® plays a vital role in expanding financial inclusion through its network-branded prepaid debit card, helping millions of Americans join the financial mainstream.
The Aspen Institute published its findings on financial inclusion in a paper titled: Why Now is the Time for a National Strategy to Build an Inclusive Financial System (October 2019).
This paper lays out the case for why it’s more important now than ever for the United States to build an inclusive financial system. Financial insecurity is increasingly common and—amid the longest period of sustained economic growth in modern U.S. history—millions of American individuals and households are struggling to find financial stability in the short-term and financial security in the long-term.
The paper notes that safe, affordable, and responsibly provided financial services can strengthen an individual or family’s ability to make their own choices and have control over their circumstances. Unfortunately, not all financial services are accessible, safe, or produce good outcomes for consumers. Among Aspen’s findings were:
- Only 28 percent of Americans are considered financially healthy amid historic economic growth.
- Federal government agencies that provide financial services and set financial regulations are responding to consumer demand and technological innovation by exploring rulemaking and systems changes. This presents an opportunity to establish financial inclusion as a fundamental component of future financial services systems.
- The field of financial inclusion has expanded from a focus on access to the measurement of household-level outcomes, allowing for more precision in the development and delivery of financial solutions.
- The U.S. trails other countries around the world in its lack of a comprehensive financial inclusion strategy.
- Big tech companies are attempting to enter the U.S. financial services arena to address challenges facing those who feel excluded by the current financial system. This reality should motivate the federal government to develop a comprehensive strategy to assess and evaluate the merits and risks of such entries.
This kind of information developed by the Aspen Institute and others, is useful in reinforcing the need for programs like Direct Express® and informing their future development as they seek to put important financial capability in the hands of those that need it.
For more information, check out the Aspen Institute’s Financial Security Program.
SOURCE: Aspen Institute