2012 Banking Survey: Banks Go Fee Happy

Banks are boosting fees to offset new regulations meant to lower them

   

2012 Banking Survey: Banks Go Fee Happy

According to Bankrate’s 2012 Checking Survey, checking account fees are rising fast, with some jumping 25%.

Experts cited by Bankrate attributed the soaring fees to new regulations meant to trim overdraft fees and debit card swipe charges for retailers.

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Banks Are Setting Us Up For Economic Problems Again

Those regulations hit bank’s were it hurt the most – their profit margins. In response, banks are raising other fees to offset revenue lost to the new rules.

Consumers are feeling the pinch, Bankrate found. 72% of consumers indicated that they would consider finding a new bank if checking account fees increased. That compares to 64% who felt the same way last year.

Some attempts to raise fees have encountered resistance. Bank of America (NYSE:BAC) withdrew plans to charge a fee for simply having a debit card after customers raised an outcry.

Here are some of the new ways banks are increasing revenue at customers’ expense, according to Bankrate.

  • No More Free Checking: Less than 40% of banks offer free checking without a minimum balance. That’s a sharp fall from 76% of banks that did so just three years ago.
  • Maintenance Fees Rise: The average monthly maintenance fee jumped 25% compared to last year. Customers must keep an average of $723.02 in their accounts to avoid that fee, a 23% increase over last year.
  • High ATM Fees: Using an out-of-network ATM will cost you. In addition to the $2.50 fee you pay to the ATM owner, you’re bank will charge you an average of $1.57 per transaction, an 11% rise from last year.
  • More Overdraft Fees: Banks have raised the fees for having insufficient funds to cover checks and debit card transactions to an average of $31.26, a record.
  • Low Interest Rates: While banks are asking for money from customers, they are giving less back. Interest rates for the average checking account have fallen to a paltry 0.05%.

You can find more detail about Bankrate’s checking fee findings on its website.


Article printed from InvestorPlace Media, http://investorplace.com/2012/09/2012-banking-survey-banks-go-fee-happy/.

©2014 InvestorPlace Media, LLC

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