Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
Filene study finds bank fees dwarf those of credit unions
WASHINGTON (11/23/09)--Bank customers pay substantially more in overdraft fees and other account fees than credit union members, with low-balance bank customers taking the brunt of that burden, a recently released Filene Research Institute study has found. The study, which was authored by University of California, Davis assistant professor of economics Victor Stango and Dartmouth College associate professor of economics Jonathan Zinman, draws information on transaction account fees from the account data of a panel of consumers. While some of the cost differences “can be attributed to behavior,” the study concluded that “much of the difference simply stems from banks’ higher prices.” “The largest driver of the bank/credit union fee difference is the overdraft fee, which on average is roughly one-third lower at credit unions than at banks. Credit unions also charge significantly lower ATM foreign fees,” the study added. Overall, the study found that while credit union members paid $35 in overdraft fees over the course of a year, bank customers on average paid $132 in overdraft fees over the same time period, almost four times the amount paid by credit union members. The report also found that while credit union members pay an annual average of $73 in total transaction fees, including ATM foreign fees, ATM surcharges, and other fees, bank-customer households pay $183 in fees during the same time period. Low-balance accountholders, which the study defines as accounts with a balance under $1,500, paid $165 per year in overdraft fees if they were customers of a bank, whereas low-balance credit union members paid $42 in those same fees. General account fees were also higher for low-balance bank customers, with a reported $218 in fees being paid on a yearly basis. Credit union members paid $80, the study found. Sixty-nine percent of bank customers and 75% of credit union members surveyed fell below the “low-balance” threshold. The majority of accountholders surveyed had an average account balance of $500 or less.
Other Resources

RSS print
News Now LiveWire
3 Atlanta fed judges recuse themselves from Home Depot data breach suits via @AtlBizChron http://t.co/lfPgOXZ7sO
15 hours ago
How may falling gas prices impact the U.S. economy? Find out tomorrow in #NewsNow #Market http://t.co/Q9ec9DGLDN
15 hours ago
News of the comp. for tomorrow: Big bank unveils plans for massive $6.5 billion new headquarters #NewsNow #Market
17 hours ago
Consumer confidence surges to 7-year high #NewsNow #Market http://t.co/fMEENGuWPi
18 hours ago
Charlotte Cash, CEO of @COFCU , is engaging members by producing videos on various subject of financial interest to members.
18 hours ago