Unbanked Consumers

There have been numerous articles published about "unbanked" consumers; that is, those consumers in the U.S. without bank accounts. Usually, these articles focus on minorities living in inner cities. However, if you are really seeking to serve unbanked consumers and small businesses, open a branch in Afghanistan. Craig S. Smith describes the situation in a recent article in the New York Times.

To set the stage, he quotes from a report by the World Bank last October: "Afghanistan, which has always been at the bottom of the poverty and social-indicator rankings of countries, must now be considered as the poorest, most miserable state in the world." Afghan banks have been in trouble ever since 1973, when the king was deposed. Moneylenders, much like those that existed in biblical days, maintained financial markets. The fighting over the past several months exacerbated the financial problems and caused considerable damage to banking facilities. To make matters much worse, three departing Taliban bank officers, each with a key to the main vault, opened the vault and carried the cash in nylon feed bags to a waiting pickup truck. Other scavengers carried away adding machines, furniture and even teacups. In addition to the shortage of physical facilities and bank capital, there is a desperate shortage of human capital. Kandahar's new central bank's branch manager was most recently a clerk and has only a limited understanding of finance. However, he has enough understanding of the current situation to "keep his money at home in a plastic bag." But, let us end with one bright note. The banks have no problems with bounced checks. They do not have checks.