When banking executives hear “underbanked,” they picture a credit risk meeting. They should picture a line out the door.
By definition, an underbanked customer already has a bank account. What puts them in the category is simply using a service outside a branch in the past year: paying rent with a money order, or sending money to family abroad through a digital transfer.
These are folks who have outgrown our standard checking features and are actively shopping for what comes next.
Amr’s new report, The Unbanked and Underbanked, US, 2026, reveals who’s in that line. They are young, ambitious, and four times as likely as standard depositors to open a traditional account in the next twelve months.
Underbanked customers are next in line to buy. Let’s give them a more positive label: Builders.
More than half of young adults fall into this category: 56% of Gen Z and 58% of Millennials.
This may surprise some, but it matches how younger earners actually handle money. They use Venmo, split rent with roommates through digital apps, and send cash across borders. They work freelance gigs, collect side-hustle deposits, and run three different digital wallets alongside their primary debit card.
Every time they use an outside tool to move money faster, the FDIC logs them as underbanked.
These are households with healthy balance sheets and active careers. When you look at the age curve in Exhibit 1, you see a generational wave of people whose financial lives move faster than traditional branch software.
Underbanked status tracks transaction speed and age. You are looking at the next core demographic of retail banking.
The industry standard assumes underbanked customers stick to basic prepaid cards and emergency liquidity. The data disagree.
When we asked these consumers about their upcoming plans, 44% said they will open a new account at a traditional bank in the next twelve months. For standard depositors, that number sits at 10%.
Underbanked customers are four times as likely to walk through your doors to start a new banking relationship.
Look at what they want once they get there. 80% want credit-building tools built directly into their accounts. Another 22% are saving specifically for a home down payment.
They want products that help them move up:
They want a ladder. If your institution offers only a locked door or an entry-level fee bucket, they will find an institution that gives them the climb.
Builders want capital and upward mobility. Sell them products designed for promotion.
If your team treats this segment as a compliance checkbox or a high-risk liability, you hand your best future mortgage and wealth clients to competitors.
Institutions that bundle direct credit reporting, immediate fund availability, and transparent upgrades are gaining ground fast.
Winning this group takes three product tweaks:
Every underbanked customer already has an account, and almost half are looking for their next bank right now.
Call them Builders, and sell them what they are building.
Which of our products would a 25-year-old Builder open first, and does our marketing say so?
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