Which of the following is a disadvantage of being unbanked?

• A. Reduced risk of identity theft
• B. Limited access to credit and financial services
• C. Easier access to government subsidies
• D. Ability to earn higher interest rates on savings

Answer: (B)

Verified step by step guidance

1. Understand the term 'unbanked': it refers to individuals who do not have access to traditional banking services such as checking or savings accounts.
2. Identify the typical disadvantages faced by unbanked individuals, such as difficulty in accessing credit, inability to safely store money, and limited financial services.
3. Evaluate each option in the question by comparing it to the known disadvantages of being unbanked.
4. Recognize that 'Limited access to credit and financial services' aligns with the common challenges faced by unbanked individuals, making it a disadvantage.
5. Note that options like 'Reduced risk of identity theft' or 'Easier access to government subsidies' are generally not disadvantages of being unbanked, and 'Ability to earn higher interest rates on savings' is unlikely since unbanked individuals typically do not have savings accounts.