Banks target checking fees to find new ways to raise cash
Filed under: Company News, Economy
As people shift from using credit cards to debit cards, banks need to find new ways to sock it to them. And it looks like they may have found one: higher checking fees. If you're not careful, these fees can add up to hundreds of dollars before you even know they hit you. To wit:* Bank of America (BAC) will increase its monthly account maintenance fee on its MyAccess checking from $5.95 to $8.95 per month in June. It will also start charging a one-time fee of $35 if your account is overdrawn for five business days. And that's on top of the overdraft fees, the maximum number of which has also been raised. Last year, they would never ding you more than five times in one day; now, they can whack you up to 10 times.
* Citigroup (C) began charging 3 percent of the transaction for some debit card purchases and ATM withdrawals made outside the U.S. last year, up from 2 percent before. That now matches the cost of using credit cards. Citi also increased its overdraft fee to $34 per incident. It had been $30.
* SunTrust (STI) is charging a higher fee on its basic checking if customers overdraw multiple times. The bank also raised its overdraft fees on other accounts.
* Wachovia/Wells Fargo (WFC) is doubling to $10 its fee to transfer money to checking to cover insufficient funds on some accounts. It will also start charging that fee to a credit card rather than taking it from a linked bank account, so you could end up paying interest on that charge as well.
"They are supposed to act in the interest of shareholders, so they're gouging consumers," Sam Johnson, a former chief economist for the International Monetary Fund, told USA Today. He thinks banks are raising account fees because of a "mix of market power and opportunism."
While the U.S. government bails out these banks because they are "too big too fail," banks choose to use this power to take advantage of consumers who are struggling. The same consumers who are taxpayers that helped to bail out these banks.
Banks defend their choices by saying say consumers have become riskier customers with the higher unemployment rate. In addition, banks say their borrowing costs are higher -- which I really have to wonder about, given the trillions the government has pumped into the loan markets at this point.
Bankrate.com says ATM fees, monthly service fees and balance requirements for interest checking accounts all hit record highs in 2008 before inflation. Bankrate predicts consumers should expect more of the same in 2009.
Have your fees gone up on your accounts? Are you thisclose to throttling the people who run your bank?
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Reader Comments (Page 1 of 23)
5-28-2009 @ 2:14PM
-CC said...
Bank fees on customers went nuts about 10 years ago, but some competitive regional banks figured out that the misc. fees really piss off customers - this opened the door for the regionals to pick up a lot of new customers driven away from the major banks by excessive fees. In recent years many banks began dropping their misc. fees in order to appear more consumer friendly (and try to retain customers). If banks try to fee their way out of their financial woes they are only going to drive business AWAY. You'd think they would had learned that lesson once already?
Reply
5-28-2009 @ 5:38PM
jackie said...
drive customers away to where? another bank who is doing the same thing? They know if they all become crooks we will have no choice but to put up with it...so messed up this country!
5-28-2009 @ 5:36PM
mickey said...
They should make people pay for their own lost or stolen or cloned debit and credit card fraud instead of making all the good customers foot the bill with this total crap.
5-28-2009 @ 6:17PM
JAS said...
Go with credit unions. I have been employed by money center banks for the past 30 years and have lost my job three (3) times, due to reorganizations, and consolidations.
I am now looking for employment outside of the banking field.
Place your money with credit unions, as they are non-profit financial institutions.
Traditional financial banks do not give a rats ass about the common individual.
5-28-2009 @ 7:32PM
pam said...
I thinl all that banks havel earned is that we'll tend to roll over for almost anything. I hate to admt that George Bush didn't set this wheel in motion but he did kick it into overdrive. Did anyone protest ? Not really. And the ones that did were persecuted for it.
Obama hasn't ruined the economy;GDub did. Obama hasn't been in office long enough to screw things up. He's just trying to stop the avalance and trying to find the bottom of the pile of dreck that GDub left for someone else---meaning tax payers and his predecessor,who ever he might be---to clean up.
5-29-2009 @ 2:20AM
Caitlyn said...
My husband just got charged $10 for a check he deposited from a friend, bounced. Since when? I've never heard that the person who is shorted, also gets charged by their own bank.
5-28-2009 @ 2:23PM
Alan S. said...
Anyone know of anything scummier than the large banks?
Just wondering.
Alan
Reply
5-28-2009 @ 2:49PM
Joseph Guignon said...
Yeah, the head honcho in charge in Washington!
5-28-2009 @ 2:50PM
JB said...
Alan, yes! The Obama administration!
5-28-2009 @ 2:51PM
victorlazlo58 said...
Congress.
5-28-2009 @ 3:10PM
Mel G said...
Alan the only people scummier than Banks are INSURANCE COPIES
5-28-2009 @ 3:30PM
Fred Elks said...
I say it's the entire Congress (both parties), the Obama administration, and the Supreme Court!!! They are all a bunch of low-life criminals who should be tried, convicted and put in prison..every one of them, including their wives or husbands.
5-28-2009 @ 6:01PM
Bill said...
The Zodiac Killer!
5-28-2009 @ 3:32PM
KATHLEEN GRIFFIN said...
no
5-28-2009 @ 4:17PM
Simzee said...
Yea. The CEO of the bank, whom is probably benefitting from the extra fees.
5-28-2009 @ 4:26PM
charlie c said...
Yes I do. New Jersey Government!
5-28-2009 @ 4:33PM
wayne said...
Yeah, the obama admin. He thought he was going to change things about the Banking industry, well they got him. Move your money out to a Credit Union or pay cash for everything. We stopped the oil industry now lets work on the banks
5-28-2009 @ 4:47PM
Fallon said...
I just got off the phone with an "Executive" in Wachovia's North Carolina office who was respondin to an email I sent to the President and CEO of Wells Fargo, amongst others there and I also cc'd the Federal Reserve, the Texas State Attorney General's Office, the Federal Trade Commission, etc. My complaint boils down to this...how can they justify offering a "courtesy" overdraft protection to their customers then out of nowhere discontinue the service without notifying the consumer? I have been hit with over $500 in NSF charges because I was unaware that they had stopped as I continued to pay bills, buy groceries, etc. Her point was that I needed to keep better records. That's b**sh**! I'm keeping my records as I use my account but when they go in like a mole and play a switcheroo in mid-stream, it has all gone to hell in a handbasket. I'm so mad right now I can't see straight. And to top it off, there are two notations of "Overdraft/Unavailable fees" ...one is $175.00, and the other for $70.00. When I asked her exactly what were these for, she was trying to explain but her numbers weren't coming out right.. I'm now waiting for her to investigate it further and she is suppose to call me back. I hate banks. I hate them all. I guess they have to look for someone to pay the million+ dollar salaries that the big boys get.
5-28-2009 @ 5:22PM
Mont said...
Politicians, corporate lawyers and bank lobbyists.
5-28-2009 @ 6:00PM
Christopher said...
yes - AIRLINES!