Bank of America CEO Brian Moynihan speaks the truth when he says banks have a “right to make a profit.”
But you also have rights…
You have the right to move your money to a different bank if you are unhappy with fees. You also have the right to whine, complain and throw a temper tantrum over bank fees that would shock the world’s worst behaved two year-old. And maybe you should.
It might feel like you are just one little person whose voice won’t make much of a difference. But in reality, if you feel one way about something…chances are there will be hundreds, more likely thousands, and possibly even millions of others who feel the same way.
Just look at what happened when Bank of America announced a $5 fee for using your debit card in 2012.
Bank fees have been popping up like pimples on a high school freshman’s face.
That’s because banks will be losing revenue after new federal regulations from the Dodd-Frank Act cut down on money financial institutions earn from overdraft fees – and more importantly debit card swipe fees.
As the largest bank in the United States – with 57-million consumer and small business customers – Bank of America stands to lose billions of dollars because of the new rules.
After a firestorm of criticism was thrown at Bank of America over the last week – the big guns finally said something.
BofA CEO Brian Moynihan
Brian Moynihan defended BofA’s debit card fee decision on CNBC saying he has a “duty as a CEO of a publicly owned company” to generate a return for the bank’s shareholders.
He also said that Bank of America customers would “understand” why they now have to pay $60 a year to use their debit cards.
Moynihan justified the new fee by saying BofA was being transparent about it, and that it was necessary because of the cap on interchange fees that came with the Dodd-Frank act.
Bank of America isn’t the only big bank making big changes. Just a few days ago Citi announced it would start charging significantly higher fees for its checking accounts.
The other two banks in the so-called “Big Four” – JP Morgan Chase and Wells Fargo had already been testing a $3 debit card fee in some markets.
But the key word there is testing…
Wells Fargo and Chase were only sticking a toe in the water while BofA did a cannonball dive into the pool – and obviously made a huge splash. If things go okay with BofA’s $5 debit card fee, the other big banks will shrug their shoulders and jump in as well.
You can flock to your local banks and community credit unions for a while, but eventually those financial institutions will be joining the “higher fee pool party” too. Because hey…everyone wants to make a profit, and if you can’t beat ‘em, join ‘em.
That’s what will happen…unless you stand up and complain!
Why Whining Could Actually Work
The reason Wells Fargo and Chase only introduced a debit card fee in test markets was they wanted to see how much their customers would push back.
How much will people moan to customer service reps? How many will complain on social media outlets like Twitter and Facebook? How many will leave the bank completely?
Citibank customers don’t have to worry about debit card fees for now. That’s because it surveyed customers and found out people absolutely hated the idea of a monthly debit card fee.
When any company sees a public relations nightmare that could turn into the loss of many customers – they will more than likely change their tune or scramble to apologize and justify the changes. Look at Netflix if you don’t believe me.
Even if they don’t reverse course – other companies will see what happened and avoid making the same potentially costly mistake.
We could just assume that there is nothing we can do about all the new bank fees and just sit around and let it happen.
Or you could make a little noise on Facebook, let your bank know you’re not happy, and if you are really serious – move your money somewhere else.
An article on Brian Moynihan’s statement’s was one of the most popular and most commented on stories of the week at CNNMoney.com.
Not only were many comments ripping apart BofA and its new fees, people were also spreading the word about banks they respected and enjoyed working with.
“Yes, BofA you do have a right to make a profit. Just like I have a right to hate every second I spent with your bank 13 years ago, and laugh at your business and it’s ridiculous fees. I also have a right to let everyone know that USAA, despite being a military bank at it’s core, allows those NOT in the military to open accounts. Accounts, which are blessedly free of just about any fee. Ohh and they deposit my money a day earlier than you…ohh, and they allow me to deposit checks via my mobile phone…or at home…..and they reimburse me for using your ATM’s….all while NOT TAKING A BAILOUT BECAUSE THEY KNOW HOW TO MANAGE THEIR BANK AND IT’S ASSETS.
So yah, you go ahead and continue to make your profits on the backs of your customers, and I’ll continue to receive a check in December from my bank for doing nothing more than being a member. I like that…” ~ Rob on CNNMoney.com
If you are a Bank of America customer – do you plan on making your voice heard? Or are you unconcerned about the new fees? Is it just a cost you’re willing to deal with?
Leave a comment and let us know!
Please RETWEET & SHARE using the social media buttons below if you found this article useful or interesting!
Image: Stuart Miles / FreeDigitalPhotos.net
+Kasey Steinbrinck is the lead blogger on personal finance and the economy for Check Advantage. When you order checks from Check Advantage, you’ll find hundreds of unique photography featured in the Wildlife Checks section as well as affordable QuickBooks Checks for business.
Related posts:
{ 3 comments… read them below or add one }
I am disabled and am on a fixed income – so these new $5 fees are a real concern to me. I was thinking of simply changing how I buy things – and use credit cards to avoid this fee (apparently that’s what BoA’s own employees are going to be doing, according to the operator I talked to).
But I keep feeling like if I really want to send a message, then I’m going to have to simply change banks. If it hurts Bank of America – then I think I have a moral obligation to take my money elsewhere. I’ve had a pretty good relationship with the bank my entire time there – and I’ve been able to look away after all the news of the horrible things the Bank has been accused of – but kicking the American people while their down… I’m probably going to leave Bank of America. Other banks like Citibank talk a good game, of not implementing a $5 fee – but then they will only be doing that for the well-to-do, with $6000 in their bank accounts.
I simply don’t understand how Bank of America sees this as a good move – to save billions, they are ultimately going to loose even more as they finally cut the last bit of good-will customers had towards the company. I sure hope the other banks are looking at this, and opt out of Bank of America’s tactics.
Kandou Erik recently posted..Dairanger Returns!
Those are some great thoughts – but be careful about the advice they’re giving you.
There’s a reason that BofA is telling people to simply use credit cards instead of debit cards. Banks make even MORE money off of credit cards! Swipe fees are higher than debit cards. It’s still 2% to 3%. Plus, you the consumer could also be charged other fees or end up paying interest if you carry a balance on the card.
Debit cards are great because they help people stay out of debt by using money from their checking account – but banks realized they were losing money because of that fact. It’s probably one of the reasons fees on debit cards got out of hand.
I agree with you. The best way to send a message is to join many others and switch banks!
Yeah! we have a right to transfer or move our savings in a different when we are no longer happy at there services and hidden fees.
Rex Boerma recently posted..Used mini cooper