2012 Banking Survey: Banks Go Fee Happy
by Christopher Freeburn | September 24, 2012 1:05 pm
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.
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.
- checking account fees are rising fast: http://www.bankrate.com/finance/checking/checking-fees-record-highs-in-2012.aspx
- BAC: http://studio-5.financialcontent.com/investplace/quote?Symbol=BAC
- increasing revenue at customers’ expense: http://www.bankrate.com/finance/checking/checking-fees-record-highs-in-2012.aspx
- checking fee findings: http://www.bankrate.com/finance/checking/checking-fees-record-highs-in-2012.aspx
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