America’s banking industry has gotten a lot of press in the past few years, and much of it has been bad.
The bailout cost taxpayers unbelievable sums of money and to add insult to injury, much of that money went to executive bonuses. In response, the banks’ public-relations teams went into overdrive to do damage control, and made a big, concerted show about lowering their overdraft fees.
Now, however, banks might be quietly raising fees – on credit cards, checking accounts, ATM transactions, insufficient funds and the like — in order to make up for lost revenue.
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Rising Costs of Checking Accounts
America’s banks make much of their profits from customer fees. One fee that’s on the rise is for the use of a checking account. These monthly checking account fees are usually incurred if the funds in your account go below a certain amount.
Some examples include:
Bank of America
Before: $5.95
Now: $8.95
Citibank Access or EZ accounts
Before: Zero
Now: $7.50
Banks Are Hiking Credit Card Fees, Too
Banks are also seeking to make up for lost revenue by hiking credit card fees and interest rates. (See New Credit Card Fees Causing Consumers Grief)
This is due, in part, to impending changes in credit card laws that are designed to be more consumer-friendly. With the new laws estimated to cost the banks $56 billion, finding new ways to increase revenue is going to be a big priority.
Some examples are:
Capital One
Purchase and balance transfer rates up 50%
Cash advance rates up 20%
Penalty rates up 30%
Citi
Purchase and balance transfer rates up 27%
U.S. Bank
Purchase and balance transfer rates up 33%
Be proactive. Get caught up on all terms concerning your bank accounts and credit cards. You never know when the bank is going to hike your fees and rates because they put the news in the fine print. If the fine print and complicated language overwhelm you, call a customer service representative and get the facts from a human being. (Hopefully your bank or credit card won’t charge you for the call.)
Use your ATM card at supermarkets. They usually offer cash-back services and no fees are charged.
Join a credit union. They’re generally not-for-profit, and offer far gentler terms on all their services.
Shop around. Don’t like your bank or their fees? Find another one. You’ve got options, and if you start exploring them you might find that your current bank will start to sing a different tune. (You can find great rates on our rates charts.)
Related Banking Articles
- New Bank Loan Standards Cause Hike in Consumer Credit
- Checking Account Rate Deal of the Day: Coastal Community and Teachers Credit Union at 3.82% APY
- Money Market Account Rate Deal of the Day: Washington Community Federal Credit Union at 0.75% APY
- Checking Account Rate Deal of the Day: Generations Bank at 2.00% APY
i got an email from my credit union that legislators are going to try to create a law that requires the credit union (THIS APPLIES TO ALL CREDIT UNIONS, NOT JUST MINE) to charge a fee every time we use our OWN atm, AND merchants can choose to set a MINIMUM charge amount for all purchases from said credit union. WHAT THE EFF??!?!?!??!?
from the email I received:
“The amendment to S. 3217, the Restoring American Financial Stability Act, places new regulations on interchange fees and could lead merchants to accept debit/credit cards only from financial institutions they choose. This could have an immediate and negative impact on credit unions and consumers. Specifically:
1. We could be forced to charge you and other Members fees for the convenience of using your SchoolsFirst FCU debit card and checking account, and;
2. You could be denied the use of your SchoolsFirst FCU debit/credit card by certain merchants and retailers based on minimum and maximum purchase thresholds they could set.”