checking accounts are slipping away, with only 46
percent of banks still offering them to their customers.
a major change from 2009, when more than 78 percent of
banks offered the freebie, according to a national
survey done by bank research firm Moebs Services.
most credit unions are still offering free checking,
even though a few have cut back too, said G. Michael
Moebs, chief executive of Moebs Services. "Credit
unions believe their members want free stand-alone
checking" so they offer it to cement relationships
other words, at these institutions free checking isnít
a reward for doing other business. Customers who have
checking accounts can simply count on the traditional
way they have banked. On the other hand, many banks may
only offer free checking to people who have broad
relationships with the institution, like using
73.6 percent of credit unions are offering free
checking. In 2009, 84.9 percent did, and last year it
was 79.6 percent.
have been cutting back on the freebie as costs have
risen, Moebs said. Both banks and credit unions are
spending heavily on security due to fraud, and since the
passage of Dodd-Frank legislation, the costs of
complying with new regulations have risen, he said.
Before new regulations enacted after the 2008 financial
crisis, a $1 billion institution might have had one
person working half-time to make sure government
regulations were obeyed; now itís four to five people,
addition, the number of transactions people do monthly
in their checking accounts have risen sharply since
people started using debit cards for small purchases, he
said. Unlike in the past, when checks might have been
devoted to paying bills and making a few large
purchases, now "the average person uses their debit
cards to pay for Starbucks or a sandwich."
a result, the average person does 50 to 60 transactions
a month, compared to 20 to 25 in the early 1990s. And
there are added costs with the transactions since each
involves accounting, he said.
interested in free checking will be more likely to find
it at credit unions, Moebs said. But he suggests that
people also consider other costs beyond checking when
selecting institutions. For example, he said, many
institutions charge $30 for each overdraft, while some
keep the fee at $25.
banks, rather than large banks or credit unions, tend to
have the lower overdraft charges, Moebs said. So the
combination of free checking and lower overdraft charges
might be more likely found at community banks.
shopping for free checking, Moebs said to be aware of
"bait and switch" tactics and make sure the
free checking is solid. Also, note other services
important to you like 24-hour access to your account
through your mobile phone. Some offer desktop access but
not mobile access.