MONEY MATTERS

U.S. Banks Aren’t Backing Down On Higher Fees For Customers

By Nancy Zimmerman

THANK OCCUPY WALL STREET FOR FORCING BANK OF AMERICA TO BACK DOWN on its proposed $5 monthly surcharge for debit card users. Bank Transfer Day boosted credit union deposits and left its mark on banks. Still, don’t expect banks to take it lying down.

Forced by regulators to halt egregious overdraft charges, and now with the highly publicized push back against debit-card use fees, banks remain determined to recoup these sources of lost revenue.

“Banks tried the in-your-face fee with debit cards, and consumers said enough,” Alex Matjanec, cofounder of MyBankTracker.com, tells the New York Times. “What most people don’t realize is that they have been adding new charges or taking fees that have always existed and increased them, or are making them harder to avoid.”

To wit:

• Gone missing is the “free checking” that most banks previously offered. the number of free checking accounts available has plummeted from 76% of all (non-interest) accounts to only 45%.
• Half of US’ top 10 banks now charge $25 if customers close an account before a certain period, usually ranging from 3 months to 6 months, has passed.
• Pre-paid debit cards issued to folks collecting unemployment benefits often cost $20 to get cash out of an ATM, even if withdrawals are on the same ATM network.
• Bank of America now charges $5 to replace lost debit cards — or $20 to have it rushed.
• Notwithstanding attempts to reign in overdraft charges, Americans will still pay a whopping $38 billion this year for overdrafts — a new record.

For the moment, bankers are taking a wait-and-see attitude before determining if consumers’ new militance is for real. “We’ll see if our customers complain and move, or just complain,” Richard K. Davis, U.S. Bancorp’s CEO told investors on a recent conference call.

Perhaps we need to make Bank Transfer Day a regular occurrence?

Nancy Zimmerman is a money coach at YourMoneyByDesign. Having emerged from a disastrous relationship with money herself several years ago, she helps folks regain control of their day-to-day finances. She writes weekly at CrabbyGolightly on money matters.