The California Public Banking Option (AB 1177), or BankCal, Closes the Financial Services and Racial Wealth Gap by Guaranteeing Zero-cost, Zero-penalty Banking Services Platform to All Californians


Sacramento, CA

Today, a coalition of lawmakers and financial services advocates joined to announce landmark legislation that would offer a zero-cost, zero-penalty bank account to all Californians. The California Public Banking Option Act (AB 1177), also known as BankCal, creates a financial services platform with existing financial institutions to close the widening racial wealth gap fueled by the exclusion of low-wage communities of color from basic banking services.

According to the FDIC’s survey data, one in four California households and nearly half of Black and Latino California households, are either unbanked or underbanked. That means they lack a bank account or pay a high price for basic financial transactions like cashing their paycheck. BankCal is a public financial services platform that will help to level this playing field, particularly for low- and middle-income Californians, by offering universal access to standard tools of financial autonomy that higher wage-earners take for granted, eliminating the need for exploitative alternatives to traditional banking and reducing the risk of catastrophic downward spirals.

“California families are losing hundreds of millions of dollars in fees a year to payday lenders and check cashing stores that prey on the most vulnerable. With BankCal, more families will be able to keep the money they’ve earned, put food on the table, and build their savings,” said Assemblymember Miguel Santiago, lead author of AB 1177. “We can’t create a stable economy when financially underserved households spend an average of 10% of their take-home pay in fees and interest just to access their own money and pay bills. Creating a public option for banking and closing the racial wealth gap isn’t only a moral imperative, but it also creates greater financial security for all of our communities.”

Maria del Carmen Bentancourt is one of the millions of Californians without a bank account. She has worked at McDonald’s for 14 years and earns $14.36 an hour which she uses to help pay rent, groceries, a bus pass, and to pay off a loan she took on to help pay for her parents and sister’s recent hospitalization.

“I would love to have a bank account because I could be saving the money I’m spending to cash my paycheck, but the fees to keep a bank account are too high and I don’t always have enough money to meet the balance requirements,” Maria says. “Right now, I spend about $300 a year just to cash my checks, and that’s money I could be using for clothes for my daughters and for food. A little goes a long way.”

The central component of BankCal is a no-fee, no-penalty debit account requiring employers to facilitate direct deposit, when requested, into the account. Features include a debit card, automatic bill pay capacity and free ATM access at participating banks. Additionally, BankCal provides infrastructure that could be coordinated with local, state and federal agencies to streamline public benefit payments and other disbursements to account holders, including many previously unbanked Californians. BankCal would be available to all California residents and participation is voluntary.

“Unequal access to basic services—including financial services—have devastated low-income communities and communities of color during this pandemic,” said Jyotswaroop Bawa, Organizing and Campaigns Director for the California Reinvestment Coalition. “Families across the state who were already struggling to get by have plunged deeper in a sea of unpaid bills, are facing even greater financial uncertainty than before the pandemic.”

“Part of ensuring that everyone can bounce back stronger from the pandemic is addressing systemic exclusion of low-wage, Black, Brown, and immigrant working people from full participation in our economy,” said Joseph Bryant, President of SEIU 1021 and Executive Board Member of SEIU California. “It means making sure that everyone is paid family-sustaining wages, has a voice on the job, and the tools to build financial stability, regardless of the color of their skin, where they work, or how much money they make. BankCal is a concrete step in breaking down the barriers to opportunity that working people of color have had to endure for far too long.”

“Pawn shops, payday lenders, and many check cashing businesses operate with profits as their priority, not the well-being of our communities,” said Trinity Tran, co-founder of the California Public Banking Alliance. “BankCal is the innovative solution we need to strike at the heart of extractive and predatory business practices.”

The California Public Banking Option Act will be heard before the Assembly Banking and Finance Committee on April 29, 2021.
To view a video of the press conference announcing AB 1177, go to


Mike Roth, 916-813-1554
Maria Elena Jauregui, 818.355.5291 (Spanish-language)
Brian Maxey, 559-286-7705
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