Underbanked individuals are individuals with bank accounts who frequently rely on alternative financial services such as check-cashing services and payday loans instead of traditional banking products like loans and credit cards. Underbanked individuals often live in banking deserts where there is a lack of convenient, affordable banking services. According to the Federal Reserve, approximately 13% of U.S. adults are underbanked.

The underbanked demographic typically includes those with lower income and less education. Many underbanked individuals live paycheck to paycheck and require immediate access to their funds, which traditional banking branches may not provide. As a result, underbanked individuals turn to alternative services that offer instant cash, despite increased fees.