Nearly one year after furor over big bank fees drove thousands of consumers to move their money to credit unions, a new study finds those fees are higher than ever, and Michigan consumers are some of the hardest hit.
The survey from Bankrate.com looked at 247 banks in 25 cities across the nation, and found that only 39 percent of banks today offer noninterest checking accounts free of charge on a standalone basis, down from 45 percent of banks last year and 76 percent in 2009.
Greg McBride, senior analyst for Bankrate, told FoxBusiness.com that the last bastion for truly free checking may be with credit unions, community and online banks. More than 70 percent of large credit unions still offer free checking according to another survey published earlier this year by Bankrate, McBride said.
According to the survey, while most big banks did respond to last year’s outcry over proposed debit card fees, they’ve simply found other ways to recoup the lost revenue.
Bankrate.com found that ATM fees have inched up over the last year, marking the eighth straight year of increases. On average, banks now charge noncustomers $2.50 to use their ATMs, though in many metropolitan areas, the fees are even higher. Detroit banks in particular, did not fare well in the study, coming in with the fifth highest fees in the nation charged to customers who leave their ATM network, at $1.86 per transaction. That’s in addition to the average surcharge of $2.55 that Detroit ATM operators charge to noncustomers, which means a customer charged both fees would be pay an average of $4.41 in fees for each out-of-network withdrawal.
In another sign of the times, this year’s survey marks the first time that 100 percent of the banks that Bankrate.com surveyed reported that they charge noncustomers to use their ATMs.
Bank overdraft fees also continue to creep up, rising 1.4 percent from last year for an average cost of $31.26.
MCUL & Affiliates CEO David Adams pointed to the survey as more clear evidence of the credit union difference.
“Our membership numbers continue to rise as more and more Michigan consumers recognize that they deserve better than this endless barrage of fees from big banks,” Adams said. “Our message of lower fees and better rates at Michigan credit unions is one that resonates with consumers now more than ever. We will continue to keep that message in front of the public through our statewide efforts, and encourage Michigan credit unions to do the same in their individual marketing and outreach efforts.”
McBride reinforced that message in a press release where he stated, “A free checking account is still within reach of the majority of Americans, whether by getting the fee waived through direct deposit or moving to a bank or credit union that still offers free checking.”