September 17 2010 (Jeff Alan)
With the passing of the Finance Reform Bill and the banning of a variety of fees – including certain overdraft and excessive late charges, banks and credit card companies are increasing existing fees and creatively finding ways to charge existing customers more for their services.
Already this year cash-advance fees and balance transfer fees have risen to 4%, up from 3% in July last year, according to a study conducted by the Pew Health Group’s Safe Credit Cards Project.
Many of the major players in the banking industry – Bank of America, Wells Fargo, HSBC, Citibank and American Express are announcing new requirements on checking account minimum balances or pay new fees, charging fees for paper statements, or if you need images of a check. Some have announced fees for their credit cards…or if they already do, higher fees.
So what can a consumer do?
Regardless of what the major players are doing, there are many competitors in the banking industry. Consumers should take advantage of this increased competition to negotiate fees with their banks.
In fact, banks need to be very careful to limit the amount of fees they can charge customers or risk losing them to a competitor in this tight economy. Let us not forget that in the 80’s we saw the rise of credit unions under these similar circumstances.