So maybe you don't hate your bank. But you might not feel warm and fuzzy about your financial institution either - especially if it's a big commercial bank. More than half of Americans are still angry at big banks over the 2008 financial crisis, and 3 out of 4 think big banks put the interests of their shareholders over their customers, according to a recent survey conducted by Harris Poll for Kasasa, a service that offers free checking accounts through nearly 300 community banks and credit unions.
"Not all Americans hate their bank," says Kasasa CEO
1. Monthly service fees. Big bank customers are twice as likely to feel "scammed" by fees than community bank and credit union customers, according to the survey. And the most-hated fee is the monthly service fee, which banks charge customers to maintain their checking accounts. Less than 40% of non-interest checking accounts and only 4% of interest checking accounts are completely free, according to an annual checking survey conducted by Bankrate.com. Many banks levy a monthly fee if certain requirements such as making direct deposits, maintaining a minimum balance or paying bills online aren't met.
2. ATM fees. Fees charged by banks for using ATMs outside their networks are the second most-hated fees, according to the Kasasa survey. The average cost of going outside a bank's ATM network is at an all-time high of
3. Overdraft fees. These fees that financial institutions charge if you opt in to an overdraft protection program and spend more than what's in your account are at a record high of
4. Minimum balance requirements. Although not as despised as the aforementioned charges, fees that financial institutions levy on customers who fail to maintain a certain balance in an account add insult to injury, Krajicek says. About one-third of U.S. households live paycheck to paycheck, according to
5. Low rates on interest-bearing accounts. Almost half of those surveyed by Kasasa said they would switch banks to earn higher interest rates. Rates on interest-bearing accounts are relatively low across the board. But generally speaking they're much lower at big banks than at smaller institutions and online banks. The national average on interest-bearing accounts is 0.04%, according to the
6. Poor customer service. Despite consumers' hatred of fees, they're actually more likely to close an account because of poor customer service, according to the Ernst & Young 2014
Consider switching banks
Despite consumers' gripes about their banks, many don't bother to switch to another financial institution, says
In fact, you're twice as likely to find free checking at a credit union than at a commercial bank, according to a study by
Online banks that provide services only through the Internet are another alternative. They usually don't charge a monthly fee, and some reimburse ATM fees, charge low or no overdraft fees and offer interest-bearing accounts that yield more than the national average. See our picks for the best deals in online banking.
If you'd rather stick with a big-name bank but aren't happy with the high fees or low rates offered by yours, keep in mind that some large financial institutions do offer no-strings-attached free checking that pay better-than-average interest rates. For example, Capital One's 360 Checking, an online-only account, requires no monthly fees or minimum balances, offers access to 40,000 fee-free ATMs and pays up to 0.9% in interest, depending on your balance. You can't get help with your 360 Checking account at Capital One branches, but there's a toll-free phone number to call if you need to talk to a bank representative.
If you're reluctant to switch to an online bank because you want access to a branch where you can conduct transactions in-person, you shouldn't rule out an online-only account if it offers other features that you want. Choosing a bank shouldn't be an all-or-nothing proposition, McBride says. Because it is so easy to link accounts at multiple institutions together now, you might want to open a checking account with, say, a credit union to avoid fees, a savings account with a higher yield at an online bank and get loans through a community bank with lower interest rates, he says.