Congress to introduce President's `First Accounts' initiative

WASHINGTON - At press time, Sen. Paul Sarbanes (D-Md.) and Rep. John LaFalce (D-N.Y.) plan to introduce in Congress the week of May 8 legislation enacting the First Accounts initiative proposed by President Clinton earlier this year. The announcement was made May 8 by Treasury Secretary Lawrence Summers in his speech to the Consumer Bankers Association. The $30 million First Accounts initiative will finance pilot strategies to help low- and moderate-income consumers without financial relationships open low-cost accounts at financials. It will also expand provisions of the Electronic Transfer Account (ETA) launched by Treasury last year to provide the estimated more than 10 million recipients of federal payments without accounts at credit unions or banks, the opportunity to set up a low cost electronic account at a financial to which their federal benefit can be directly deposited and which they can access. Thus far more than 500 credit unions and banks throughout the U.S. are participating in the ETA program. Summers said Treasury acknowledged that some potential ETA beneficiaries may be reluctant to take advantage of the program because they either live in an area where there aren't any ATMs they can use to withdraw their money, or because they lack safe access to an ATM.