Banks launch new, subtler fees
November 30, 2011
True, Chase dumped its plan to charge a $10-a-month checking account fee and Bank of America dropped its plans for a $5-a-month fee on debit cards. But if this seems like a trend toward cheaper banking, think again.
Instead of sticking with its much-publicized new charges, banks are resorting to quietly bumping up fees customers are already paying, hoping they won't notice or, if they do, that they won't get mad enough to move to another bank.
Here are a few examples:
- Bank of America plans to roll out a new selection of checking accounts next year that carry fees ranging from $6 to $25.
- Citibank has boosted its basic checking account fee from $8 a month to $10.
- TD bank is now charging $15 for incoming wire transfers.
The crush of fees is a result of the banks looking to recover the revenues they stand to lose from caps on overdraft fees and debit card swipe fees, which is costing them an estimated $12 billion a year, according to the New York Times. That translates into $15 to $20 a month from each depositor.
In addition, many banks are also actively cutting costs, closing branches and reducing interest paid on CDs and savings accounts. While customers may be able to avoid some of the charges by increasing their number of accounts or depositing more money with their bank, it seems customers may have to be extra vigilante in the coming months to avoid new fees.
The flurry of new, subtler charges has prompted federal lawmakers to push for streamlined disclosure forms for bank patrons opening new checking accounts. The typical disclosure form now is more than 110 pages, and lawmakers would like to see them condensed to something akin to a food packaging label. The hope is that this would make it easier for consumers to shop around and compare.