Defending Access to Banking Means Defending the IDNYC

Few banks have taken the step of allowing the IDNYC to be used as a primary ID.

The New York City-issued identification program – “IDNYC” – is a powerful tool meant to bring all New York City residents into the service mainstream, and is an important statement of our shared municipal citizenship. The card, first issued in 2015, was designed to provide a free government-issued identification card to the many New Yorkers who typically lack access to such identification, including undocumented immigrants and homeless populations. 

Formal identification is needed for myriad activities, such as entering schools and other government buildings and accessing certain services. Identification is also necessary to access the formal banking system, and avoid dealing in cash and using high-cost alternative financial services such as check cashers, pawnshops, and certain high-cost prepaid cards. Unfortunately, few banks have taken the step of allowing the IDNYC to be used as a primary ID, which has only continued the unnecessary marginalization of many immigrant communities in our city.

[pullquote]Few banks have taken the step of allowing the IDNYC to be used as a primary ID.[/pullquote]

That’s why ANHD applauds Maria Vullo, Superintendent of the NY State Department of Financial Services, for supporting this key issue in her first year in office. She issued a strong statement last month urging state-chartered banks and credit unions to accept the IDNYC as primary identification to open a bank account. The IDNYC is one of the most ambitious municipal ID programs in the country. As of January 2016, over 725,000 New Yorkers now have the card. Unfortunately, one of the areas where it has not had the intended impact is in access to banking. According to the Daily News account of the letter, Superintendent Vullo wrote that banks can accept the Municipal ID as proof of a customer’s identification and, "The Department encourages New York state-chartered and licensed financial institutions to accept the Municipal ID as a form of acceptable identification card.” This follows a similar letter by federal bank regulators stating that the IDNYC is in fact a legitimate form of government-issued identification. Federal regulation says banks can rely on government-issued identification to verify a customer’s identity and regulators made it quite clear that the IDNYC is as robust a form of government-issued identification as any other kind. Yet, despite this guidance, banks, bankers associations, and some local legislators continue to make bogus arguments as to why financial institutions cannot and should not accept it.

[pullquote]Yet, despite this guidance, banks, bankers associations, and some local legislators continue to make bogus arguments as to why financial institutions cannot and should not accept it.[/pullquote]

In response to Superintendent Vullo’s letter, New York Bankers Association President Michael Smith said, “The opinion of the Department of Financial Services is consistent with an earlier opinion by the federal regulators, which left in banks' discretion the decision whether to accept IDNYC for opening bank accounts, as long as the customer meets the bank's established standards for compliance with federal and state laws." However, this is ridiculous. The guidelines are no different than those for accepting any other federal or state issued identification, such as driver’s licenses or non-driver identification cards.

[pullquote]The guidelines are no different than those for accepting any other federal or state issued identification, such as driver’s licenses or non-driver identification cards.[/pullquote]

A recent article in the Staten Island Advance reports on Assemblyman Castorina of Staten Island perpetuating these myths by implying that the requirements to get the IDNYC are less stringent than other IDs, despite clear guidance to the contrary. He also invents a new problem about recent arrivals being able to get the ID.  “He criticizes the city issuing the cards to people living here for as little as 15 days.” There is no waiting period to get a state identification card. In fact, new residents are required to change their driver’s license within 30 days or face penalties. It is disappointing then that, according to the City’s IDNYC website, only five banks (and seven credit unions) accept the IDNYC card as a form of primary identification to open a bank account. Worse, two banks – Popular Community and BankUnited – accepted it as a primary ID in 2015 and no longer do so.  More banks accept it as a secondary ID, but that is not the main barrier to open bank accounts. None of the largest banks in the City (Chase, Bank of America, Citibank, HSBC, TD Bank, or Capital One) accept it as a primary ID – Chase doesn’t even accept it as a secondary ID.  This leaves too many New Yorkers on the sidelines without access to formal banking services.

[pullquote]This leaves too many New Yorkers on the sidelines without access to formal banking services.[/pullquote]

ANHD urges all banks to finally stop with the excuses and accept the IDNYC as primary identification. It’s safe, it’s government approved, and it’s the right thing to do.