Defining Households That Are Underserved in Digital Payment Services
October 10, 2024
Summary
US households that lack digital means of making and receiving payments cannot participate fully in an increasingly digitized economy. Assessing the scope of this problem and addressing it requires a definition of households that are underserved in digital payments. Traditional definitions of households underserved in the banking system—those that are unbanked and those that are underbanked—do not account for the ownership of nonbank transaction accounts that can be used to make and receive digital payments. In this paper, we define households underserved in digital payments by considering four key elements—access, use, safety, and affordability—and discuss how researchers may assess these elements to quantify the share of households underserved in digital payments.
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Payments Data Report 2024-3
October 2024
JEL Classifications: D12, D18, G21, G23
Key words: Digital payments inclusion, underserved, fintech, nonbanks
Digital Object Identifier (DOI): https://doi.org/10.29338/rdr2024-03
The views expressed in this paper are those of the authors and do not necessarily represent the views of the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of Atlanta, Kansas City, or Boston, or the Federal Reserve System. The authors are responsible for any errors.