This research is empirical and exploratory in nature. It examines the emergence of a market of underserviced consumers within the U.S. banking subsector of the financial services industry. The aim of this research is to introduce generalizable sociological theory that explains the formation of an underserviced consumer market. This new social theory called Underserviced Consumer Market Formation Theory (UCMFT) is then applied to the U.S. banking subsector of the financial services industry in order to address the research question of, Why has an emerging market of underserviced consumers formed within the U.S. banking subsector of the financial services industry? In addition to introducing UCMFT to academia, other contributions to knowledge have materialized as a means of explaining this phenomenon and answering the research question of this study. These additional contributions to knowledge are: introducing the term underserviced consumer within the U.S. banking subsector of the financial services industry and introducing a theoretically based explanatory model specific to this subject matter of this research termed the model of underserviced consumer market formation within the U.S. banking subsector of the financial services industry. Positioning UCMFT for future research and generalizability includes clearly defining the industry being studied, clearly defining the term underserviced consumers in the context of the industry being studied, and empirically identifying and linking the unique psychosocial characteristics to the predominant consumers (buyers) within the industry being studied or encompassed by the research. Potential industries that could be included for future research grounding in UCMFT are healthcare, technology, telecommunications, education, as well as other subsectors within the financial services industry. Overall, the empirical findings support the creation of the theory and its applicability to the U.S. banking subsector of the financial services industry as scoped for this research.

As the lending practices of the alternative financial services (AFS) industry harm many consumers and consumers' access and use of traditional credit are restricted, the use of AFS is a growing concern. The financial education of consumers determines their financial behavior, which may be inadequate to make effective financial decisions regarding high-cost borrowings. The purpose of this quantitative study was to examine if and to what extent the sources of financial education is related to the use and frequency of use of AFSs among U.S. consumers. The theory of planned behavior and the transtheoretical model of change shaped the theoretical framework for this study. An explanatory correlational design was used to analyze archival data collected by the FINRA Investor Education Foundation for their 2015 National Financial Capability Study. Binary logistic and negative binomial regression analyses indicated that exposure to formal financial education did not contribute to reduced use and lower frequency of use of AFSs but, instead, contributed to the exact opposite. Only parental financial education was found to contribute to reduced use and lower frequency of use of AFSs. One-way ANOVA analyses indicated that all forms of financial education contributed to increased perceived financial knowledge. This study may lead to positive social change by informing policymakers about the necessary steps to remedy the problem of continuous AFS usage and serving as a foundation for future studies that should consider other factors beyond formal financial education that could influence the use and frequency of use of AFSs.

This research seeks to determine what factors and combinations of banking features drive the choice of a financial service provider. Two studies have been devised to explore the research question. The initial study, uses factor analysis and logistic regression to examine the importance of perceived cost, convenience, and relational trust in the choice of a financial services provider. An additional study uses choice-based conjoint analysis to conduct an exploratory study to identify combinations of banking features that potential customers perceive as most attractive. The study simulates real-world buying situations that ask research participants to trade one financial services attribute for another. Results from the first study suggest that a consumer’s choice of banks, prepaid cards, online lending, and the US Postal Service for financial services is associated with a preference for convenience while relational trust and perceived cost drives the choice of “street” AFS providers. In the second study, results from the choice-based conjoint analysis suggest that fees are significantly more important than convenience and level of customer contact across all categorical variables (age, gender, race/ethnicity, employment, income, and education). Additionally, in-person customer service contact is considered more important than convenience. Understanding these factors, optimal combinations and proportions, and trade-offs through the eyes of the consumer, may be of value to both policy makers and industry officials alike when grappling with options to strengthen financial inclusion. / Business Administration/Strategic Management