Many Americans, tired of being nickel-and-dimed, are changing where they keep their nickels and dimes.
While the official number of people who participated in Bank Transfer Day on November 5 have yet to be determined, information from various sources say that anywhere from $50 million to$4.5 billion was moved from national banks to community banks and credit unions. It wasn’t just the much-protested Bank of America $5 debit card fee that spurred people into action, but that ill-timed fee became a catalyst for many to say “no more.” Public dissatisfaction with big banks have erupted over bailouts, fees, and impersonal service. Energized in part by the Occupy Wall Street movement, Bank Transfer Day, also known as Move Your Money Day, encouraged consumers to consider giving their business to smaller banks.
Whatever the amount moved from the big banks on one day, the Move Your Money protest is clearly striking a chord—the organization has more than 45,000 “likes” on Facebook. Asking consumers to “Invest in Main Street, not Wall Street,” the website notes that smaller banks spur job growth because they do much more lending to small businesses than bigger banks.
Many people have stayed with their banks, despite the rising fees and dissatisfaction with customer service because it seemed daunting to switch, says Frank Sorrentino, CEO of North Jersey Community Bank. He says he has seen an uptick in new customers ever since the economy started to go bad, starting around 2007. By offering free debit cards, online banking and free checking, he says, he is able to build lasting relationships with clients.
“The big banks think [when they raise fees] ‘what we lose in people, we gain in fees,’” he says. “Community banks don’t think like that. We do well because of our relationship with customers. We have clients who actually cost us money. But they bring in good will and good PR and [maybe they’ll bring in] their family.”
Credit unions, while different from banks, can offer the same level of customer service.
Hava Gurevich, an artist and director of a traveling exhibitions company, recently moved her funds to a credit union on Long Island. She was impressed with the manager who sat down to help set up her account, stayed until after closing to answer her questions, and gave Gurevich a certificate promising no fees for life. “It was a really wonderful experience,” she said. “With my other banks, especially Chase, there was always this push to get me to sign up for something more. I felt no such pressure here.”
Shel Horowitz, author of “Guerrilla Marketing Goes Green,” switches his funds to a community bank whenever his current bank gets bought by a major bank. “Strengthening the local economy and having financial institutions that actually care about small customers are two of the reasons why we got out of Fleet, Bank of New England, and others within a few weeks after they bought up our local institutions,” he says. “During the six or eight weeks it took us to switch out of Fleet, we found their customer service people extremely uninterested in our small-potatoes checking account. High fees and poor service — why should we stay?”
It can seem daunting to tie up all the loose ends associated with closing an account with a big bank including automatic bill pay for numerous utilities and direct deposit of paychecks. And yes, while breaking up is hard to do, Move Your Money offers help in the form of a search tool to help newcomers find nearby community banks and credit unions, while Green America offers a Break Up With Your Mega-Bank kit.
As for the bother, Evan Davies, a DJ at WFMU.org, who is in the process of switching over to a credit union, says, “I was able to open the account completely online — in fact, I have yet to set foot inside a branch.” Plus there’s that customer service that for many, makes the switch worthwhile. “The few questions I've had were answered via email or phone by the head teller at my home branch, who's been very helpful and friendly.”