Justification Memo - Focus Groups on Mobile Financial Services with Unbanked and Underbanked Consumers 4-10-15 Final

550 17th Street NW, Washington, D.C. 20429-9990

Legal Division

Federal Deposit Insurance Corporation

April 9, 2015

 

Memorandum to:        Shagufta Ahmed

Policy Analyst              

                                    Office of Information and Regulatory Affairs

                                    Office of Management and Budget

 

From:                 Gary A. Kuiper /s/ Gary A. Kuiper

Counsel

Legal Division

                                    Federal Deposit Insurance Corporation

RE: Focus Groups on Mobile Financial Services with Unbanked and Underbanked Consumers

Under the generic clearance entitled, “Information Collection for Qualitative Research ” (3064-0198), the FDIC hereby submits for OMB review the Mobile Financial Services for Underserved Consumer Focus Group Interview Protocol. These instruments will be fielded in April and May of 2015 as part of a larger qualitative research study on the potential for mobile financial services to meet the needs of unbanked and underbanked consumers.

The FDIC recognizes that public confidence in the banking system is strengthened when banks effectively serve the broadest possible set of consumers. As a result, the Agency is committed to increasing the participation of unbanked and underbanked households in the financial mainstream by ensuring that all Americans have access to safe, secure, and affordable banking services.

Results from the FDIC’s 2013 National Survey of Unbanked and Underbanked Households suggest that mobile financial services have the potential to increase the mainstream banking participation of unbanked and underbanked households. To further explore this potential, the FDIC plans to conduct a four-phased qualitative research project. The materials in this packet pertain to Phase 1 of this qualitative research: eight focus groups of consumers who have a bank account, but also utilize alternative financial services, such as check cashers (underbanked) or do not have a checking or savings account (unbanked). Half of these consumers will be current users of Mobile Financial Services and half will be non-users.

Respondents will be recruited using existing databases from research facilities in Los Angeles, CA and Memphis, TN. The facilities will be able to pre-identify respondents who fit into the target population, ensuring efficiency in recruiting. Participation in the focus group will take approximately 2 hours (120 minutes). Respondents will be determined to be eligible for the interview after completing a screening questionnaire, Recruitment Screener, which asks questions about age, gender, whether they make financial decisions for their household, whether they have a checking or savings account, whether they have used any alternative financial services in the past year, and if they currently use any mobile financial services.

Upon checking in at the focus group facility, the Recruitment Screener will be re-administered to respondents to ensure they are qualified for participation. Research facility staff will explain the study, explain their rights as a research participant, and obtain a signed consent form. Participants will then fill out a two-page Intake Survey which will be used to collect background information to make sure the subsequent group discussion is focused on topics relevant to the participants.

The focus groups will be moderated by a facilitator who will ensure that the desired topics are fully covered while managing group dynamics and ensuring balanced participation. The focus groups will be unstructured to allow discovery of issues and in-depth probing on the topic. Two of the eight groups will be conducted in Spanish by a bilingual moderator.

The FDIC expects to use the outcomes from this research to understand consumer needs and banking behaviors, the role of mobile financial services to making banking more accessible, and the types of mobile banking functionality that helps or could help consumers and financial institutions engage in sustainable banking relationships. The research will also be used to help develop a list of potentially useful mobile banking features or topics to evaluate further in a subsequent research stage (phases 2-4). The findings will be used to identify broad themes around the issues and will be represented as qualitative in nature. A final data collection report will be produced at the end of Phase 2, documenting methodology, findings, and recommendations for subsequent phases of research and implications for strategies for economic inclusion.

The anticipated burden for respondents is shown below. We anticipate screening 600 respondents in order to complete 8 focus groups each with 10 respondents (80). The screening process will take 5 minutes, and focus group participation using the Discussion Guide, (including a 5-minute Intake Survey) will take 120 minutes. Therefore, this effort will require 210 burden hours (((5*600) + (80*120))/60 = 210 hours). To offset travel costs and time spent, respondents will receive $100 following the completion of the interview.

If you have any questions, please let me know. Thank you for your consideration.