Banking Deserts: What Are They and How Do Global Remittances Help?

Generally speaking, a banking desert constitutes any geographic area without a local bank branch. As expected, there is a range of definitions for banking deserts across the financial and legislative realms.

For example, the Federal Reserve Bank of New York considers a banking desert any area that “has no bank branches within it or within ten miles of its center.”

Conversely, the Hope Policy Institute states that “bank deserts are defined as ZIP Codes with zero or one bank branch.”

Despite these slight definitional differences, the statistics surrounding banking deserts—as well as their instigators—are not up for debate.

Banking deserts are caused for myriad reasons, including bank failures, branch closures, population losses, and most recently, increased demand for digital and online-only banking.

This problem has been well-documented over the last decade.