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Could Making It Easier To Switch Banks Stop Rising Fees?

Could Making It Easier To Switch Banks Stop Rising Fees?

 

Bank of America didn’t seem to be entirely prepared for the public outcry it received over the announcement that all debit card holders would be charged $5 a month to use their card.  But, unlike restaurants or retailers who are easy to boycott in protest, they probably weren’t too concerned about the fallout and calls from people saying they would be switching banks.  After all, transferring accounts is a difficult process — changing autopays, notifying companies, opening new accounts, ordering new checks and cards.  Who’s going to go through all of that hassle to save themselves $60 a year?

But what if it wasn’t a hassle?

Democratic Senator Dick Durbin is urging all Bank of America customers to put their money where their mouths are — or where their feet are — and switch to a new financial institution.  Durbin, who is being singled out by the bank, who claims that they have to raise fees in order to compensate for the money they will be losing over new regulations authored by the senator, is firing back at those institutions.

“Bank of America customers, vote with your feet. Get the heck out of that bank. Find yourself a bank or credit union that won’t gouge you for $5 a month and still will give you a debit card that you can use every single day,” urged Durbin. “What we are doing is fair to try to strike some balance in an industry that has shown little or no balance. And one of the worst offenders in this is Bank of America, the largest bank in the United States.”

Durbin may be talking big, but Democratic Congressman Brad Miller is proposing action.  Miller is working on legislation that would make it easier for customers to simply leave a bank they don’t like and move to a new one without all of the additional complications.  According to Miller, “The biggest banks have turned the switch for market forces to the off position. If consumers could shop around for banks the way they can for everything else, banks wouldn’t think they had a God-given right to pay their executives vulgar bonuses and still make enormous profits, and consumers would get a much better deal.”

So what would be included in Miller’s bill?  According to the Huffington Post, a bank customer would have the right to close an account at any time, with no fees or punitive charges, via email, phone or in person, and the bank would inform the customers of reoccurring payments and charges to the account for 30 days, to ensure the customer doesn’t wrack up new fees, delinquencies or collections while the account is being switched.

Would you be more likely to switch your bank if it were easier?  That question could be the one to make or break the new attempts to regain lost profits on the backs of their customers.

 

Related Stories:

New Wells Fargo “Debit Fee” Likely to Hurt Poor The Most

Restaurant Chain Takes High Banking Fees From Servers’ Tips

Single Mothers Could Lose Child Support To Credit Card Companies

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Photo credit: revisorweb

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29 comments

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10:13AM PDT on Oct 22, 2011

love my independent bank there are so few.Took a few years to get insured and authorized but am very glad for it

12:26PM PDT on Oct 10, 2011

Hell, yes! My "new" bank (was taken over by M&T) now charges its customers 50 cents everytime they use their atm cards as debit cards, so I am forced to do credit transactions everytime I use my card! F###ing ridiculous!

11:12PM PDT on Oct 5, 2011

I use credit unions.

9:54PM PDT on Oct 5, 2011

The banks have to learn who they are in business for.

7:01PM PDT on Oct 5, 2011

My bank eliminated its free checking accounts & started charging $5 a month to use your debit card back on Sept 1. If you don't have direct deposit or maintain a certain balance, you have to pay for your checking account. I'd change banks if I could, but most of them run a credit check before they'll let you open a checking account. Since I refuse to have a credit card, I have a poor credit score, so I can't use the big national banks.

5:33PM PDT on Oct 5, 2011

Here we go again. The greedy are at it again. Take from the customers and pay outrageous bonuses to the executives who don't deserve it, don't merit it and never earned it. Just showing up in the office is reason enough for those bonuses!??! If it were easier to get out of the bank and into another more people would do it. Like has been said, joining a credit union may not be the perfect ideal, but at least they don't nickel & dime you to death. I have yet to hear anything positive about BOA. They were told to pay a customer lawyers fees and court costs for a foreclosure that should never have been started because the customer paid in cash for the house. The customer got a foreclosure on the bank and went with movers, sheriff and lawyers to the branch and started foreclosure on the bank. Boy did they pay up quick.

5:16PM PDT on Oct 5, 2011

Join a credit union! They are not perfect, and not everyone has one that they can join, but they are not profit driven, so their fees are low.

4:53PM PDT on Oct 5, 2011

This is BAD NEWS......

1:43PM PDT on Oct 5, 2011

yeah, it's time to bring down the 'too big to fail' banks. i've belonged to a credit union for 30+ years. what i like about CU's is that they are customer runowned.

10:53AM PDT on Oct 5, 2011

I switched to a credit union several years ago from Wachovia, and have been very pleased with the NONPROFIT credit union. Since then, Wachovia was convicted and paid a huge multi-million dollar fine for laundering drug syndicate money, on which they made lots of profit. Talk about unethical. The article said many other banks do it too, but Wachovia got caught due to a whistleblower. Wells Fargo took them over, and then W/F was accused of rampant mortgage fraud. Deal with credit unions or small, community banks. None of the big, greedy banks!

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