U.S. banks may end free checking accounts: report

Thu Jun 17, 2010 11:20am EDT

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(Reuters) - Bank of America Corp and other U.S. banks may introduce new fees on basic services and eliminate free checking to replace revenue lost to new banking regulations, the Wall Street Journal said.

The move is expected to hurt retail clients who could be asked to pay new monthly maintenance fees on the most basic accounts that do not generate a lot of activity, the paper said.

To avoid a fee, customers will have to maintain certain account balances or frequently use other banking services, such as credit and debit cards, automated teller machines and online accounts, the Journal said.

Banks incur an expense of between $250 and $300 a year to maintain each of the roughly 200 million checking accounts, the paper said citing industry estimates.

Bank of America may lose more revenue than most other big banks because it is in the process of dismantling its checking-overdraft program in the face of new restrictions.

From this summer, banks must receive customer permission before they can charge for overdrafts.

However, in March, Bank of America announced plans to suspend overdraft fee charges on all debit card transactions from this summer.

Bank of America could not immediately be reached for comment.

(Reporting by Sakthi Prasad in Bangalore; editing by Balazs Koranyi)

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Comments (32)
ktownty wrote:
Banks do not incur an expense of $250-300 per account. If anything they gain money by being allowed to borrow against the amount in the account. Hogwash. Dear Fed someday someone will stop your outrageous money dealings.

Jun 17, 2010 1:26am EDT  --  Report as abuse
lincun86 wrote:
Why anyone would choose to use banks after the fiasco they created with their greed is beyond reason. Credit unions offer the same services and usually without the hoops the large banks put you through. I object to keeping those fat cats on the take, no one is worth that kind of reward for greed.

Jun 17, 2010 1:33am EDT  --  Report as abuse
No, no , no…When a company like Bank of America curtails some of its predatory and unethical behavior in the face of public pressure, it does not, “…lose more revenue than most other big banks.’

That is like saying an embezzler took a “cut in pay” when they stopped stealing.

Please BofA, and Chase and Wells…keep pushing on us…until one day Americans learn that their local Credit Union is fair, ethical, safe and actually has a stake in the health and welfare of the community it serves.

Come on you Greedy Bastards…make (our) day!

Jun 17, 2010 1:46am EDT  --  Report as abuse
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