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Fee Increase Attempt Inspires 'Dump Your Bank Day'
suraj.sun writes with this excerpt from CNN Money: "Customers are dumping their banks in droves ahead of the nationwide 'Move Your Money' and 'Bank Transfer Day' movements this Saturday. Given the recent spotlight on attempts — and ultimate failures — by some of the nation's biggest banks to tack on new debit card fees, thousands of disgruntled consumers have already either left or pledged to leave their current bank for a community bank or credit union, which are known for having fewer and/or lower bank account fees. ... At least 650,000 consumers have already joined credit unions since Sept. 29, the day Bank of America announced plans to impose its controversial $5 debit card fee, according to a nationwide survey of credit unions by the Credit Union National Association."
I moved to a credit union 15 years ago and never looked back. Good service and no ridiculous fees.
I last had a B of A account when I was 19. They had the highest credit card rates of any major bank in the country. I shopped around for a day and found a bank with an interest rate 7 points lower than theirs. I moved accounts and a few years later found a credit union with a rate 3 pts lower than the new bank. So I cut my rate from 19.8 to 9.9 just by not being too lazy to shop around. For some reason however, 19 out of 20 people I tell this story to have ump-teen superficial reasons why switching banks would be too much trouble. The truth of it is, they are complacent and lazy.
There shouldn't be even a single person complaining about the bank bailouts or Wall Street who still has an account with these money pimps. If you do business with them, you are an enabler and partially responsible for the bank meltdown of '08.
Peace, K1
Many credit unions are part of the CU Service Center and share ATMs and even teller services. My CU is in Seattle and I have deposited checks at CUs in Minnesota. Not true for all CUs, but many are part of this system.
Says someone who has clearly never belonged to a credit union.
This is an important sentimentality to reflect on. Banks and other businesses count on emotion and habit to keep our business even when their quality suffers. Does the BofA you see today reflect the values of Seafirst? Would your parents still recommend that you do business there? If you are feeling sentimental, frame your debit card after you close the account.
...but they'll get it in different ways. I just received the fees schedule for next year, and it isn't pretty. I started an account at my local credit union, and as soon as my paycheck direct deposit is setup, I'll be closing my account(s) with BofA. I won't give my money to a corporation that is recklessly investing my money when i deposit it, all while nickel-and-dimeing me to death.
I certainly do not like all the fees that banks have, but didn't B of A drop their plans for the fee? http://www.marketwatch.com/story/bank-of-america-to-drop-debit-card-fee-report-2011-11-01
I had heard of credit unions before, but I didn't know what they were and I didn't have sufficient interest to find out. I only researched it after this Bank of America incident. Now that I know, it's obvious to me that a credit union is better.
The difference is that credit unions are explicitly not-for-profit. Their main goal is not to maximize shareholder value, but to maximize member usefulness. That makes a really big difference.
TCP: Why the Internet is full of SYN.
http://message.bankofamerica.com/debitcard/
credit unions tend to be very different from regular banks. It's owned directly by the people who put money into it. The people who bank there make the decisions on what happens. And they are not for-profit, so they can put all that extra loan income back into savings account interest rates.
All the world's a CPU, and all the men and women merely AI agents
Yep, they've put that $5 on hold for now.
But they'll look for different ways to stick you with additional fees.
They want to keep increasing revenue. And you're the source of that revenue.
On a related note, when you switch banks, make sure you know EVERYTHING about your transactions. Too many stories out there about how someone missed an automatic payment (annual or some other kind) and the bank re-opened their account, charged them and then charged them an overdraft fee. Even when the account was SUPPOSED to be closed.
I joined a Credit Union when I was 12, and that was a long time ago, indeed. I have never looked at a bank account set of terms and conditions that was not absolutely offensive and repulsive when compared to the Credit Union.
Once, about 20 years ago, when I lived in Miami and the nearest branch of my Credit Union was in Tampa, I opened a local account to be able to deposit my paychecks locally. That lasted about 6 months, during which time they charged fee after fee, and posted a $20 "computer error" in their favor to my account. Computer error, in 1991, from a bank? The computer made a mistake adding a column of numbers? "Sorry sir, we'll fix that." Yeah, you do that, and give me all my cash, NOW.
Perhaps it's not sentimentality as much as age of oldest active account, something that gets reported to the three major credit bureaus.
I'd long heard the advice about Credit Unions being a better bet than a bank, but honestly, I felt switching might be more hassle than it was worth. I knew Credit Unions had membership restrictions, for starters. (For instance, Navy Federal Credit Union pretty much requires you're either in the armed forces, or a family member of someone who is. That doesn't help me.)
I always tried to bank with smaller, local banks though, instead of any of the "mega banks". That strategy worked pretty well for me when the bigger ones went through a phase of eliminating "totally free checking" accounts, some years ago.
However, I tried to get refinanced on my car loan a couple years ago and found none of the banks were willing to help me at all -- even the one I have direct deposit with from my work, and hold both a checking and a savings account with. My rate was WAY too high and I wasn't asking the world ... just an opportunity to get a sane interest rate. That's when I decided to take a closer look at Credit Unions. I discovered one of the bigger ones had 2 convenient branches near my house AND was partnered up with most of the others in town, so you could use ATM machines belonging to ANY of them free of charge. Their only rules for becoming a member seemed to be based on you living in a zip code somewhat geographically close to their branches. A day later (since they had to have the bank manager review my situation and he was out for the day), I had my loan refinanced at a rate a full 10 percentage points lower than I was paying!
I switched my checking account over to a second Credit Union not long after that, and was paid over $100 in bonuses just to switch!
I'm a currency collector and a WheresGeorge addict, so I visit banks very often, complete with unusual requests. So I suppose retail service is more relevant to me than others.
Do you have any problems with the folks at your credit union branch(es)? I honestly wouldn't know either way. CU's won't do even simple stuff for non-accountholders, so I don't have any experience with the personnel save for a negative impression. I have gotten accounts at some regular banks that I initially visited as a non-accountholder.
of all the issues with big banks, retail-location customer service doesn't seem to be one of them.
In general, the cheap version of something is sometimes satisfactory, sometimes not.
I listen to both RIAA and non-RIAA stuff if I like the music, tangential business/politics nonwithstanding.
They had a credit union at my last job, and I decided to use it, in part because I was going to be buying a house soon, and I assumed that a credit union would offer a better deal than a "regular" mortgage company.
I didn't find anything about the credit union that was better than what I was used to at regular banks, and when I applied for a mortgage, I discovered they had a "demand feature", which I had never seen before (this was my third time buying a house). For those who don't know, a demand feature means that the credit union could, at any time and for any or no reason, demand that I pay the mortgage in full.
When I asked them about it, they assured me that "everyone did it" and that they wouldn't actually do that even if they could and that I should just trust them and not worry about it.
I immediately dropped them and went to a regular mortgage company, which did not have a "demand feature" and offered a better rate. I later learned from other employees that the credit union had "called" mortgages of other employees when they missed a payment on their linked credit card.
So, don't assume that a credit union is better than a bank or other financial organization. Some may be, but others aren't. Caveat emptor!
1. Federal government passes law that banks with over $10b in assets may not charge merchants as much as all banks have been charging for debit transactions.
2. Larger banks (the only ones affected by said law) impose a monthly, instead of per-transaction, fee to make up the difference, while smaller banks continue to charge merchants the same amount they were before.
3. Outrage is expressed by the uninformed and pundits who have an axe to grind, such as Consumers Union.
4. Larger banks lose customers to smaller banks, who will continue to charge merchants the same amount for debit transactions.
5. Larger banks reverse position on monthly fee but increase other fees in order to indirectly make up the difference.
Who exactly won? Thanks Dick Durban!
Hello little man. I will destroy you!
For all you servicemen and families of servicemen, USAA is a great institution. They offer 100% free checking - free bill pay, free checks, free debit cards with cash-back, and they refund ATM fees at the end of every month (even fees from non-USAA ATMs). Deposits can be done via smartphone, scanner or at your local UPS Store.
Even those with no relation or connection to the US Armed Forces are eligible for certain banking products, so if you're looking to drop your mega-bank I absolutely urge you to check out USAA's offerings. The lack of branches outside of San Antonio, TX can be a bit disappointing when you need to deposit cash, but the customer service is wonderful and I've never really even had a need to do anything in-person, anyway.
I've never heard of that happening to a credit union. I doubt the members would stand for it in most cases. Why would they want their cost of banking going up?
On the other hand, I've seen a couple of cases where CUs got big enough and started acting like banks. CEFCU (formerly the Caterpillar Credit Union) in IL is one of the biggest in the country and nearly 20 years ago they started doing that crap where they charged extra fees to people who only had small balances. It pissed me off enough that I closed my account with them, despite being way beyond the minimum balance requirements.
A few years later when debit cards were just starting to become popular, TexIns (formerly the Texas Instruments Credit Union) started pushing debit cards on all of their members via the combo ATM/Debit card trick - unless you kicked up a fuss your ATM card was automatically enabled for debit usage too. My understanding is that such pushes were actually widespread in the CU community and usually accompanied with a bunch of evil PR to convince members it was actually a good thing. Anyone who was paying attention knew that debit cards were a bad deal for practically everyone -- a big fee generator with far less consumer protections than credit cards.
So it isn't easy, in fact it may even be illegal to formally co-opt a CU in the way the GP described, but sometimes they do end up being managed by execs with a bankster mindset.
When information is power, privacy is freedom.
I've been with credit unions for several years now; I keep around $5K in BoA for convenience sake, but keep most of my liquid cash in credit unions. My credit unions don't insist on treating me like a criminal by fingerprinting me if I dare cash a check, they don't dehumanize services by refusing to let me talk to decision makers, don't nickel-and-dime me for services like BoA does. The down side to a credit union is there are fewer branches and fewer ATMs, so if I am out of town and need cash to dine or shop somewhere that doesn't accept AmEx, I have my BoA account for convenience. However, I'm seriously considering punting BoA altogether and just carry more cash instead.
One huge, huge benefit of credit unions is the ability to talk to decision makers, and have them check business and personal references if you have limited credit history. About ten years ago when I started my business, I made a huge, huge mistake: I closed my personal credit accounts, and built up corporate credit. I did not have a single credit line for personal use, and I needed a loan. So, I went to the banks and was turned down for a loan by several banks (citing the lack of credit history - if you go without using credit for 7 years, your credit record is "scolled out"), and couldn't talk to a decision maker. So, I went to a credit union and they turned me down at first, so I worked my way up the food chain and talked to decision makers. They checked my personal and business references, and I was able to get financing. I ended up moving a decent chunk of funds to that credit union.
Now, interesting thing: one of the banks I went to has financed several cars for one of my friends. He has horrible, horrible credit; he has had a home forclosed on, three vehicles repossessed, and they granted him another car loan shortly before I went to speak with that same rep. His interest rate sucked, but he was able to get financing. I asked about it, mentioning my friend by name and asking why with his irresponsible history he was granted financing, but with my responsible history I couldn't. His response? "He has credit. You don't." So I asked "So, you are telling me a bad credit history is better than no credit history?" His response was yes. That just pissed me off - and that kind of thinking is exactly why so many banks have needed bailout courtesy of us taxpayers.
Fuck banks. We never should have bailed them out.
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
I am on the board of a credit union. Credit unions must make a profit or they will die. They must have some fee structure to offset costs of members who are expensive to service. The idea is that fees should be minimized to the extent that the CU can run a healthy business in accordance with its mission.
Since it is a non-profit, the board is unpaid. We are members who volunteer our time. We must make decisions in the interest of the membership as a whole and that means working with the executive staff on decisions related to which services we can provide to the members and how those services will be paid for.
The distinguishing difference between a credit union and a bank is that banks can raise capital in the open markets by issuing shares, issuing debt, or taking on risky bets in the form of loans and investments.
Credit unions, on the other hand, can maintain capital only through profits from loans, investments, and certain income like fees and interchange fees. The investment side is tightly controlled. Investments are boring - bonds, CDs, money markets. The best income is from loans.
There are good credit unions and bad ones. When the bad ones go under, the credit unions are collectively assessed via the NCUSIF (in most cases) to make the the depositors whole. Or the NCUA works with the failing credit union to merge them into a healthier one. But we are all collectively responsible for each other in a small way -- yet we compete against each other and banks too.
Even though I've been with the same credit union for 22 years (and now on the BOD for 3 so far), I don't label "credit unions = good, banks = bad." I also have an account with ING Direct and had excellent customer service - all by phone, mail and email - for a mortgage a few years ago.
Do your homework and figure out what you need and talk to people you trust. Don't think that you are necessarily constrained by a credit union. You might not be. It depends.
I have had so many problems with Bank of America it's not even funny. They don't understand the words "close my account." After I get fed up with them nickel and dimeing me to death, I closed my account with them. I moved everything over to my new bank, but forgot to delete my debit card from paypal. Bad move. Six months later, my wife bought something on ebay and selected the debit card by accident. Not only did they let the charge go through, the tried to charge me overdraft fees galore. They even proceeded to send me letters threatening to turn me over to some agency so I would be banned from opening a checking account with any major bank. Remember, this is SIX MONTHS after I had them "close" that account. I will NEVER open an account with them again.
No. Amex has one of the WORSE credit card rates - their rates are consistently higher than Visa or Mastercard. Amex sees themselves as a "premier" card and want to ensure their card is only accepted at places that are more lifestyle-related. So Visa/MC is accepted everywhere, and Amex in fewer places but often in places like restaurants and hotels and the like.
A small retailer wanting Amex can easily be dinged 5% for Amex, versus 2-3% for Visa/MC. Plus the per-transaction fees are higher for them.
As for cash discount - it only really works for mom and pop shops - where handling cash is cheaper than credit cards. But larger businesses can start having significant cash handling charges - from extra training of cashiers (all the cash handling needs to be taught to ensure the balance comes out right) to simply having to deposit those huge wads of cash at a bank (depending on the store, it may mean an armored car has to be hired which can cost $1000 easily. If you're depositing $30k, that's the 3% credit card fee right there).
Why has that word replaced customers?
comment first, facts later. http://chem.tufts.edu/AnswersInScience/RelativityofWrong.htm