Bank Fees Are Costing Consumers Way Too Much Money, Study Says
|So that's where all your bubble gum money went|
We just learned that banking giants charge Americans anywhere from $84 to $144 every year just to maintain a bank account, according to a report from the California Reinvestment Coalition.
And you could probably guess the culprits: Wells Fargo, Chase, Citibank, Bank of America, and U.S. Bank.
On top of the housing woes they've brought us, these banks are also charging customers for not having enough money in their account, for getting their monthly statements mailed, and for having more than one account. Sounds kinda criminal.
These charges are making it unaffordable for many hard-working consumers to have the most basic bank account, the report says. So what's their reason, you ask? They need the money as much as we do.
Apparently, the banks need the extra cash to make up for money that they lose in overdraft fees and new regulations created to help small businesses and consumers.
To circumvent those regulations, Wells Fargo, BofA, Chase, and U.S. Bank offer customers prepaid cards, which are exempt from the "swipe fee" limits enacted in the Durbin Amendment of the Dodd-Frank Wall Street Reform Bill passed in 2011, according to the report. The bill lowered swipe fees for merchants, who were in turn supposed to lower the costs of goods for customers. As a result, banks say they aren't profiting as much as they once were from plastic swipes; hence the prepaid cards. Yet, once again, consumers get screwed, the report says.
This report calls the banks' reasoning a big pile of shit. It notes that all five banks have rebounded and are profiting overall.
"Banks have knowingly increased bank account fees in order to push their most vulnerable customers out of bank accounts and into prepaid products," said Andrea Luquetta, policy advocate for the California Reinvestment Coalition and the author of the report.
The CRC wants banks to offer safe and cheap accounts to everyone. The coalition proposed a SafeMoney™ account, which would provide customers with a debit card, bill pay, money orders, and remittances, and it would provide customers with protections from liability, theft, fraud, or unauthorized use.
Or maybe we should all just go back to using piggy banks.