MADISON, Wis. (10/21/11)--Stories of people switching from their large banks to credit unions continue to garner attention in the national media.
One New Jersey credit union, Financial Resources FCU in Bridgewater, is using billboards that state “IditchedmyBankforaCreditUnion.com” and lead consumers to a microsite with information on the credit union movement, reported the New Jersey Credit Union League. (Photo provided by the New Jersey Credit Union League)
Dennis Pierce, CEO of Community America CU in Kansas City, Mo., wrote a guest column in Monday’s Kansas City Star
assuring consumers that they have a choice in selecting institutions to fulfill their financial needs, and highlighting the credit union difference and ease in switching to a credit union from a bank. “Recently, Bank of America’s CEO noted the bank’s right to make a profit and the need to institute those fees to do so,” Pierce wrote. “He is right. It does have the right to make a profit, and so do other big banks that are charging debit card fees. I am in favor of a free market that gives these banks the right to make their own choices. As the head of a nonprofit credit union, which is owned by its members, I make different choices. You need to know you have choices, too. “The good news is there is no hidden charge at play here,” he added “This kind of open fee disclosure is what financial reform legislation is all about. Fortunately, not all financial institutions feel the same way about debit card fees as Bank of America. There are many financial institutions, credit unions and community banks that are not charging this fee and offer just as many services and products. “We can’t avoid all of life’s frustrations, but there are some things we can change. When you find a financial institution that truly partners with you and has your best interest at heart, it’s worth it,” Pierce concluded. Here are other examples of credit unions and credit union leagues taking the initiative to inform consumers about the credit union difference, and some of the tangible results:
* New bank fees have helped create a greater-than-normal level of interest in how credit unions operate and what they have to offer, said Mona Shand, spokeswoman for the Michigan Credit Union League & Affiliates (minyanville.com Oct. 19). The league said it has seen a recent spike in traffic on its credit union locator site, lovemycreditunions.org, and its members are reporting above-average levels of activity. The league is preparing the official data on that new activity, to be released sometime next week, Shand added. * New Jersey credit unions are noticing a dramatic increase in hits on aSmarterChoice.com and other credit union locators the past few weeks. Hits reached 73,633 for credit unions in the state as of Wednesday afternoon (The Daily Exchange Oct. 20). * Wisconsin consumers who switch to credit unions from banks can save $174 per year per household on service fees, according to a press release issued by the Wisconsin Credit Union League. Those who use a credit union receive total financial benefits much greater than this, the league said. Credit union members save $1,020 in interest to finance a new car compared with financing at a bank. This is based on a $25,000 vehicle with funds borrowed for five years, with a savings of $204 per year in interest. Members save $15 compared to banks on a late payment fee on a credit card. That’s in addition to enjoying an interest rate that’s just under a percent lower than banks for a typical “gold” card, the league said. * While banks and other financial institutions are starting to charge their customers simply for using their debit cards, American Airlines Federal CU (AACU), Fort Worth, Texas, said it continues to offer benefits that allow member-owners to use their card even more: a premium dividend rate, out-of-network ATM fee refunds and no monthly fees on its Priority Checking Account. “We continue to offer member-owners the same great rates and fee-free options we’ve been doing all along,” said Nancy Crouch, AACU’s card services director. “We have no intention of adding a monthly service fee or debit card usage fee to our checking accounts.” * Spokane Teachers CU in Liberty Lake, Wash., garnered a 30% increase in new member accounts so far in October (NWCN.comOct. 19). By the end of 2011, the credit union--which has no plans to start charging debit-card fees--expects to have more than 100,000 members. * Last week, 32 South Carolina credit unions announced a pledge to continue offering members free use of their debit cards (islandpacket.com Oct. 19). * BECU, the largest credit union in Washington state, saw its membership “skyrocket” since Bank of America (BofA) announced it would soon start charging some of its customers $5 a month to use their debit cards, spokesman Todd Pietzch told msnbc.com (Oct. 19). During the past few weeks, new membership is running at roughly 280% of what BECU would normally see. In an average month, between 6,000 and 7,000 new members join the credit union. However, in the first two weeks of October, more than 8,200 people signed up. “But it’s not all BofA customers. Many are people who are simply unhappy with all the new bank fees they’re hearing about,” Pietzch told msnbc.com. Also, Bankrate’s 2011 Checking Account Survey, conducted in August, indicated that 76% of the biggest U.S. credit unions offer a free stand-alone checking account. Only 45% of U.S. banks still do that, reported msnbc.com.
Credit unions nationwide are gearing up for Bank Transfer Day, in which people are signing up to leave large banks in favor of credit unions on or before Saturday, Nov. 5.