Columbia starts banking initiative for low-, moderate-income residents

The city of Columbia on Wednesday launched a national initiative aimed at connecting low- and moderate- income city residents to nominal-cost bank checking and savings accounts in a bid to raise financial awareness.

“Bank On” is an umbrella program that will link Columbia residents who don’t have bank accounts or who underutilize banking services with mainstream financial institutions to help avoid the traps that come with using high-cost check-cashing operations, predatory lenders and similar secondary financial services.

The “Bank On” program also envelops “Start Fresh,” a series of financial education workshops that begin Jan. 23. The workshops are designed to help residents who have negative banking histories to start over and utilize bank services in ways that can lead to financial independence.

The “Start Fresh” workshops will provide in-depth information on banking, budgeting, saving, building credit, homeownership and life skills, city officials said, all in an effort to accommodate residents who continue to want to call the Capital City home.

“Columbia is going through dramatic resurgence – or revitalization,” Columbia Mayor Steve Benjamin said. “When you see this much dynamic growth, as you see in cities all across the country, it could very quickly become a city full of people who can afford to live here – and a city of people who can’t afford to leave.”

“All of our community development programs, and the ‘Bank On’ program and the Individual Development Account program, are designed to make sure that people across the economic spectrum, whether they are young professionals, or just folks who have been working hard every single day in Columbia, can live and build a life for their families right here in this city,” Benjamin said.

The city’s Individual Development Account, or IDA, program is the third leg of the “Bank On” initiative that offers savings accounts with incentives for those saving to go to school, start a business or purchase a home. The savings accounts supplement the IDA participant’s savings with a three-to-one match up to $3,000. It targets individuals who have incomes at 200 percent of the federal poverty limit, or $23,500 for a single person, and a net worth below $10,000.

The program, administered by the Columbia Community Development department, is taking applications for IDA and has $150,000 dedicated to fund it, according to Deborah Livingston, Community Development director. The city also has $100 million administered to residents in home loans, city officials said.

Three banks are partnering with the city to launch the “Bank On” initiative, including BB&T, South State Bank and TD Bank. The city has been working on the initiative for nearly three years, according to City Councilwoman Tameika Isaac Devine.

At least 12.5 percent of Columbia residents are unbanked, according to the community development department, while 10. 5 percent of South Carolinians have no bank accounts. The underbanked – those who do not adequately use available banking services in Columbia — make up 27.2 percent of the city’s population, while the percentage of South Carolinians who are underbanked is 25.6 percent, according to city officials.

This story was originally published January 13, 2016 at 6:30 PM.