Bank Fees Are Hard to Find, But Free Checking Isn’t Dead Yet


We support reforms to the financial marketplace that protect consumers from unscrupulous banks and lenders.

By Consumers Union on Wednesday, April 13th, 2011

Our friends at U.S. PIRG released a report called “Big Banks, Bigger Fees: A National Survey of Bank Fees and Fee Disclosure Policies.” They surveyed 392 bank branches in 21 states and reviewed bank fees online in 12 others, in order to find out how easy (or not) it was to shop around for the best deals at banks and credit unions, and to find out whether free checking accounts have become a thing of the past.

The report’s key findings were:

1) Fewer than half (38%) of branches complied easily with simple requests for fee schedules required by the Truth In Savings Act; only after two or more requests did a total of 55% percent of branches provide fee schedules as requested and as required by law. In a finding virtually identical to GAO’s results, nearly one-quarter (23%) of branches surveyed refused to comply at all. Others provided often weighty piles of useless other brochures.

2) Nonetheless, free checking was available at half the banks visited (50%) and an additional 29% offered free checking with direct deposit. The free accounts are widely available at small and regional banks and credit unions, a finding that has also been obtained by others. While some big banks have raised fees and restricted or eliminated free checking, some still provide it, especially with a regular direct deposit.

As the banks seek to regain lost revenue from recent changes to the law, such as new opt-in rules for overdraft, it’s important to be on the look-out for new fees. Here are some tips to avoid new fees:

Consider all of your options, including smaller banks and credit unions.
The biggest banks are the ones that make the news for announcing that they plan to charge new fees, but they’re not the only game in town.

Keep a close eye on your bank statement.
New fees will show up first in the enclosures and then on your statement.

If you don’t like a new fee, complain to your bank about it. Then ask your bank what other accounts it offers -one of them may fit with your pattern of transactions better. Some fees are “trial balloons.” The bank may be testing to see if its customers will put up with a particular new fee. Call customer service and ask how to avoid the fee and to tell your bank that you don’t like it.

If you can’t avoid the fees on your current account, think about moving your money. As the US PIRG report has shown, there are a lot of free checking accounts still out there. Banks and credit unions offering free checking will be more than happy to take your business if you’re unhappy with your current financial institution. If you want tips on how to move your money safely, click here.

For more tips on avoiding checking account fees, click here.

Have you noticed new fees on your checking account? If so, share your story here.

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