Banks Hook Us With Auto-PayDo you feel stuck with your bank? You're not alone. As anger over high bank fees grows, the issue is gaining a lot of traction.

Many of us have set up our bank accounts online to pay our bills and receive our paychecks automatically. These conveniences come with a steep price. As The New York Times reported Sunday, banks use auto-pay features to hold onto customers. Knowing it means figuring out how to shift all those auto-payments keeps many from switching -- even in the face of onerous bank fees.

According to the story, a marketing study by tech finance company Fiserv showed that using the Internet to pay bills, do automatic deductions and send electronic checks reduced customer turnover for banks by up to 95%. Other evidence that fewer people are switching institutions: In 2011, only 7% of consumers have switched banks in 2011, compared to 12% in 2010, according to surveys by Javelin Strategy and Research.

Recognizing that it's too difficult to switch banks and worried about what that means for competition, the Australian government is considering a bill designed to make it easier for consumers to switch banking institutions. The bill proposed earlier this year would force banks to reroute bills to the new bank for 13 months after an account changed institutions.

Meanwhile, more than 42,000 people on Facebook are attending "Bank Transfer Day," a virtual event initiated by a grassroots movement. Scheduled for Nov. 5, it's aimed at mobilizing consumers to move their funds from retail banks to credit unions. Third-party operators such as this Switch Agent service are also making a play to capitalize on account changers.

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December 30 2011 at 12:55 AM Report abuse rate up rate down Reply
perkinsjj1977

I don't auto-pay any of my bills never have and never will anyway! I just never liked the idea of them automatically taking their money every month especially when I can't guarantee what I will have every week with the way my husbands job is. Sometimes I have to pick and choose what gets paid when and I don't think anyone can say they can pay this amount on this day of the month every month, my check comes on Fridays but the actual number date isn't on that day of the week every month no one can make that happen. I don't want someone trying to take their money on a Tuesday when it isn't their til Friday just because it was the 20th! Its easier for me just to go online and pay all the bills on their sites on Friday when I know it is actually their
not to mention my sister in law auto-pays her electric bill and never knows what the actual bill was every month when the electric company screws up and bills her wrong she has no idea cause she never sees the paper bill anymore only the balance they took off of her bank account. I can think of many reasons not to have anybody automatically taking money from your account. It is not any more convenient in my opinion and is offered by most companys as a way to make sure they get theirs no matter what even it overdraws your account cause you didn't have the funds on the right date to actually cover whatever charge they came up with.

October 18 2011 at 3:32 PM Report abuse +1 rate up rate down Reply
kentblackdog

Credit Unions have auto pay too---------------go check out your local credit union-----you will be suprised at how customer frendly they are.

October 18 2011 at 12:50 AM Report abuse +1 rate up rate down Reply
amavel

That is preposterous. Fire them on Nov.5. Protest them on Nov. 17

October 18 2011 at 12:49 AM Report abuse rate up rate down Reply
tevroc143

This article sounds like it was written for the banks since so many OWS are talking about closing out their accounts at the TOO BIG TO FAIL banks. I have always banked with a local small bank and prefer it that way. The only bad thing about a small bank is the fact the TOO BIG TO FAIL banks are attempting to buy them up. Credit Unions are good, too.

October 18 2011 at 12:46 AM Report abuse rate up rate down Reply
wdcarterjr

It Is laziness not the bank. You can change bank if you want to put the effort into it.

October 18 2011 at 12:01 AM Report abuse +1 rate up rate down Reply
norriswf

This is why I have been a credit union member for 48 years.

October 17 2011 at 11:54 PM Report abuse rate up rate down Reply
1 reply to norriswf's comment
dagriffiths251

Why are credit unions better than banks? Thanks.

October 18 2011 at 12:27 AM Report abuse rate up rate down Reply
1 reply to dagriffiths251's comment
snowmyth01

credit unions are non-profit, among other reasons. I love my credit union. (I also love the $20 they deposit back into my account at the end of the year, it's not much, but every little bit! I use it as an end of year special treat when I've behaved myself.)

October 18 2011 at 1:08 AM Report abuse +2 rate up rate down
Tom Folco

YO ZAB WHAT BANK IS THAT// WHAT CITY ?? AND STATE??

October 17 2011 at 11:42 PM Report abuse rate up rate down Reply
Donna

So it may take a month or two, but you can quit your bank and you should if your bank is screwing you. Credit unions may be the answer, but be careful, they are not always the best. Shop carefully!

October 17 2011 at 11:33 PM Report abuse rate up rate down Reply
Burr

What a stupid article. I can and did fire my bank. I had a one month duplicate bank thing going on while I transferred different functions. I now bank at a credit union where I'm not getting cheated and paying for them to use my money.
I'm floored by articles like this; how lame.

October 17 2011 at 11:29 PM Report abuse +4 rate up rate down Reply