Will expand banking access throughout Illinois, steer consumers away from predatory lenders 


August 19, 2019

CHICAGO — Gov. J.B. Pritzker signed Comptroller Susana Mendoza’s Bank On legislation that aims to steer consumers away from predatory lenders and give them better tools to save for the future. The measure was signed this morning at Devon Bank in Chicago’s Rogers Park neighborhood. 

One out of five households in Illinois doesn’t use banks. Instead, these consumers pay fees to cash checks or use payday loan shops, pawn shops or auto title lenders that charge outrageous interest rates. On average, they will pay $40,000 in fees over the course of a lifetime. 

Mendoza’s measure establishes a Bank On Illinois program, which will enable the Illinois Office of Comptroller to partner with banks, credit unions, consumer advocates and representatives of the community to certify financial products appropriate for consumers new to banking. 

Bank On programs certify products that provide fair financial service options, such as no maintenance fees, low minimum deposits, low or no overdraft fees and alternative IDs. They also provide secured personal loans — low-risk lending that allows consumers with low credit scores to begin rebuilding their credit. 

“Many of us take for granted being able to cash a check at our bank, open a savings account to plan for our family’s future or secure a loan at a reasonable interest rate,” Mendoza said. “But thousands of Illinoisans don’t have these options, and they pay for it in inordinate fees and sky-high interest rates. Bank On Illinois will help them break that cycle and offer a second chance to those with troubled financial histories to get back on the right track.”  

Pritzker said proposals like Bank On Illinois help the state’s working families. 

“Our priority here is simple: we will not sit by as bad actors attempt to take advantage of the working families of Illinois,” he said. “We’re safeguarding the financial health of all our people – and we’re doing it at no cost to taxpayers. We’re helping people access banking, and in turn, the financial independence they need to live with dignity.” 

The legislation was sponsored by State Rep. Debbie Meyers-Martin (D-Olympia Fields) in the House. 

“For thousands of Illinois families, this means a seemingly perpetual cycle of poor credit, lack of access to affordable loans and thousands taken out of their paycheck every year,” Meyers-Martin said. “In today’s economy, families need the resources that modern banking provides to survive and build a better life for their families. Bank On Illinois is a proactive approach to connect people with affordable financial services so they can escape exorbitant fees and provide the financial stability they need to build wealth for themselves and our communities.” 

The Community Bankers Association of Illinois praised the program: 

“The Community Bankers Association of Illinois appreciates the efforts of the governor, comptroller and General Assembly to highlight the needs of the unbanked and under-banked population. It is important to integrate these consumers into the mainstream financial world as an alternative to predatory actors like payday lenders and tile loans who charge as much as 500% interest for basic financial services.” 

State Sen. Cristina Castro (D-Elgin) sponsored the measure in the Senate. 

“Many in our state cannot meet the requirements to get a bank account, such as startup fees or a large minimum deposit, or they lack the needed identification or credit score. This leaves them vulnerable to predatory lenders and ends up costing them so much more in the long run,” Castro said. “Senate Bill 1332 will shield low-income families from excessive fees and give them the tools they need to help secure their financial futures.”  

Mendoza noted that the legislation, which passed with no opposition and bipartisan support in both chambers of the General Assembly, will cost Illinois taxpayers nothing – and should improve the state’s economy by helping more families get on their feet. 


More than one-fifth of Illinois households conduct their financial business outside of the traditional banking system, according to a 2015 report from the Federal Deposit Insurance Corporation (FDIC). Unbanked individuals often take their financial business to predatory lenders such as auto title lenders, cash checkers, payday lenders and pawnshops, which charge exorbitant fees for basic services, like check cashing, and high interest rates on lending.   

The Brookings Institute found that, on average, a full-time worker who doesn’t use traditional retail banking products is charged roughly $40,000 in lifetime fees. Low-income and immigrant consumers are more vulnerable to being targeted with long-term fees, in exchange for low-information lending documentation. 

Lack of access to traditional banking is a problem in both rural and urban areas all over the state. Cook County has a combined unbanked and underbanked rate of nearly 30 percent. Macon County in central Illinois and Alexander County at the southern tip of the state both have unbanked rates of roughly 35 percent.