Economic inclusion can be expanded when bank customers (or credit union members) open accounts to deposit their tax refunds by direct deposit, an outcome of involvement in the federal tax service’s volunteer tax assistance program, according to survey results released Tuesday by the federal bank deposit insurance agency.
The Federal Deposit Insurance Corp. (FDIC) said its survey (FDIC Survey of Volunteer Income Tax Assistance (VITA) Providers) found that the Internal Revenue Service’s (IRS) Volunteer Income Tax Assistance (VITA) is helping unbanked Americans access banking products and services. According to a report about the survey results:
- There is demand for banking services at VITA sites, and many sites already offer financial well-being services.
- Many respondent VITA sites are open to partnerships that would provide safe and affordable banking products for their clients.
- VITA sites that are in partnerships with banks or credit unions met their partners through networking events, the initiative of banks, and through other networking opportunities aimed at increasing economic inclusion.
The action of opening an account to receive tax refund direct deposits was referred to as “bankable moment” by the FDIC.
The banking agency said the purpose of the survey was to “better understand potential opportunities to help unbanked clients of VITA sites open bank or credit union accounts to direct deposit their tax refunds and credits.”
The survey was fielded from May 15 to June 30, 2023, FDIC said. Of the 486 VITA sites that were invited to participate, 351 responded (72%). Of those, FDIC said, 99 sites had a partnership with a bank or credit union in the 2023 tax-filing season. The FDIC collaborated with the Stakeholder Partnerships, Education and Communication Office of the Internal Revenue Service to conduct survey outreach.
FDIC Survey Highlights Potential Bankable Moments at IRS’s Volunteer Income Tax Assistance Providers