MADISON, Wis. (1/27/12)--Credit unions are among those institutions cited as an attractive alternative to the "stealth bank fees" that banks are starting to charge to recoup lost revenues from regulations and the sluggish economy, said a column Wednesday on MSNBC.
"We've found that credit unions, online banks and local community banks tend to be cheaper than the big banks," Greg Daugherty, executive editor at Consumer Reports told Herb Weisbaum, "The Consumer Man" on MSNBC's "Bottomline."
The article--just one of several appearing the past couple of weeks alerting consumers to expect new fees, more fees, and higher fees during 2012-- noted that banks are charging for: paper statements; higher safe deposit box fees; one-time services such as certified checks, money orders, wire transfers, using a teller, paying by phone, cashing a check from another bank; ATM fees for noncustomers; and higher penalty fees for overdrafts.
Chase and PNC banks are charging $25 to close accounts in certain situations, and PNC charges $3 when a customer goes to a teller to transfer funds (The Wall Street Journal Jan. 14). Many are raising their monthly maintenance fee. In February, TD Ameritrade Holding's TD Bank will charge noncustomers a $5 fee to cash checks at its branches.
Customers at Citizens Bank, a unit of Royal Bank of Scotland Group, already ante up $50 a month if they fall below the minimum balance required on some money-market accounts. Bank of America charges some customers $25 if they fall below the minimum balance on premium-checking accounts. U.S. Bancorp charges a 99-cent fee to make a mobile deposit. Those are just the tip of the iceberg.
However, some analysts predict that if the fees don't make sense, consumers will vote with their feet, like they did on Bank Transfer Day. Consumers concerned about higher fees are inundating consumer websites. For example, CreditCardForum's site received 900 questions about fees so far this month--a leap from the 200 questions about bank fees it received last January.
During a conference call to discuss the bank's earnings, Bank of America CEO Brian Moynihan admitted that the $5 monthly debit card fee it proposed in late September was rescinded when customers began fleeing the bank because of the fee. Moynihan said the ensuing public consumer outcry resulted in an "elevated level of account closings" in fourth quarter. He reported a 20% jump in closings during fourth quarter 2011, from account closings in 2010 (ABC News Jan.23).
Meanwhile, consumers are being advised by publications to look at the institution's fee schedule, watch for account-terms changes, try to negotiate with the institution to waive a fee, and if that doesn't work, move the money to a credit union, online bank, or local community bank.