WaMu planning layoffs

WASHINGTON MUTUAL has launched a new account to serve Californians who normally do not use banks but instead use check- cashing services.

It's a large population -- 20 percent of U.S. residents have no bank account or rarely use banking services, according to the California Reinvestment Coalition.

For $5 a month, Washington Mutual's Essential Bank Account offers five money orders, direct deposit with only a $1 minimum to open and one penny to stay open. By comparison, check-cashing fees can reach up to 3 percent of the face value of a check.

The Essential Bank Account has no limits on ATM or point-of-sale transactions, and no limits on teller interactions, WaMu spokesman Tim McGarry said. Seattle-based WaMu, the nation's largest savings and loan, has branches throughout the Bay Area.

WaMu has many savings services they offer their customers and would like to spread the word throughout the internet and make more people aware of their services:

� Online Savings
� Statement Savings
� Traditional CD
� Online CD
� Liquid CD

One of the interesting features about this account is thatfrom Business 1 customers with a prior ChexSystems record can open an account as long as their record does not emanate from fraud. Most banks and credit unions belong to the ChexSystems network, whose database lists consumers who have had their bank accounts closed.

The Essential Bank Account offers no checking account and no overdraft protection. McGarry said that checking and overdraft features would be unlikely to be added to this account in the future.

However, observed Kevin Stein, associate director of the California Reinvestment Coalition, Washington Mutual has recently introduced a free checking account.

"Once the consumer gets one of these (Essential Bank Accounts), he may find it easier to graduate to free checking and become part of the mainstream," Stein said.

The California Reinvestment Coalition has been appealing to banks for years, according to Stein, to introduce just such an account for the poor and unbanked.

Mergers are a time when banks are brought before regulators to show if they are meeting their community commitments. When WaMu acquired San Francisco-based Providian Financial in 2005, the CRC took this opportunity to engage Washington Mutual on the topic of such an account.

Stein commended the bank. "They followed through on their commitment. The Essential Bank Account has just become available," he said.

WaMu will honor the Mexican marticula consular and Guatemalan consular identification cards as identity as well as U.S. and Canadian driver's licenses, military identification, U.S. passports and alien registration documents.

Citibank is offering a demonstration project of an Essential Bank Account in San Diego, as well, similar in that it offers three money orders a month. However, the bank will not extend this account beyond San Diego.

Citibank has been offering its Access Account -- which allows customers to make free, unlimited bill payments online in English or Spanish and receive a MasterCard debit card for cash withdrawals and point-of-sale transactions. The account does not offer checking but facilitates three money orders a month.