Feel that pinch? That's your bank charging you a little more this year for checking and ATM fees.
The fee environment worsened for bank customers in virtually every way possible in the first half of... [+]
A new survey of 50 of the nation's largest banks finds that basic banking costs jumped in just about every category in 2012.
That includes the minimum amount required to open an account which jumped to $408.76 on average up from $391.41., according to Moneyrates.com.
"The higher this minimum becomes, the more poorer customers may be forced to go un-banked," the survey notes.
Monthly service fees also increased to $12.08 from $11.28 last year. Broken down by bank size larger banks with more than $25 billion in deposits charge more with the average monthly maintenance fee $13.88 while it was only $9.87 at small banks (those with less than $5 billion in deposits).
One way customers avoid those monthly fees is by promising the bank to keep a specified minimum balance in the account. Unfortunately the average minimum amount increased to $4,446.57 from $3,590.83--a 24% increase.
Overdraft fees increased incrementally to an average of $29.83, up from $29.23.
"Previous surveys have tended to show more of a mixed bag, with some fees rising and others falling. But the latest survey shows a comprehensive trend toward checking accounts becoming more expensive," the survey notes.
The latest data from Moneyrate doesn't bode well for banks who are struggling to keep a customers happy. Last year Bank of America announced it would start charging customers a $5 monthly debit card usage fee and it faced heavy criticism. It eventually back-tracked though.
But the survey shows that banks haven't stopped looking for other ways to charge customers additional fees. What's with the nickel and diming by banks?
Well, for one thing banks are for-profit institutions whose obligations, for the most part, are to their shareholders. But more specifically, there were new regulations made last year that affected banks' revenue stream. The so-called Durbin Amendment put a cap on the fees bank could charge retailers like Wal-Mart and Target each time a customer used their debit card there.
For instance, if a customer used their debit card for a $50 transaction at Best Buy then the debit-card issuing bank would take a small percentage of that total from Best Buy. Retailers, with the help of Senator Dick Durbin, fought back on those so-called swipe fees and won. Now banks are limited to charging retailers roughly 23 cents per swipe.
That's now translating in higher fees by banks looking for ways to make up for that lost money.
When BofA said it would start charging $5 a month Senator Durbin urged the banks customers to leave the bank. Presumably he was telling them to bank elsewhere where such fees don't exist. Unfortunately, there's new data showing the number of institutions offering free checking accounts is shrinking a bit.
Only 45% of banks offer free checking in Bankrate's 2011 Checking Account Survey, and that number is likely to drop. At credit unions, the number is higher with 72% offering free checking but that's down 4% from from last year's study.
Happy banking.
