Consumer Financial Services, Asset-Building & Savings, Financial Services Industry
Book | August 1999

Savings for the Poor: The Hidden Benefits of Electronic Banking

Michael A. Stegman

The federal government’s shift to deliver public benefit payments via electronic funds transfer holds potential to bring poor Americans into the banking mainstream.

Adjust font size


At the beginning of 1999, federal payments began to be made via electronic funds transfer (EFT); the motive behind this move was a drive towards efficiency and cost-cutting.

In this text, author Michael Stegman argues that the initiative has a far broader potential: to bring poor Americans into the banking mainstream.

Savings for the Poor outlines how many families will enter the mainstream system through EFT’99, as the program is called. Stegman proposes that it be combined with a program of national Individual Development Accounts (IDAs)—dedicated savings accounts for low-income people that can be used for purchasing a first home, acquiring more education or job training, or starting a small business.




The UNC Center for Community Capital conducts research and policy analysis on ways to make financial services work better for more people and communities.


© 2017 UNC Center for Community Capital
1700 Martin Luther King Blvd., Suite 129 • CB#3452, Chapel Hill NC 27599-3452 • 919.843.2140 • 877.783.2359 •