Lindsey Pinkham, senior vice president and secretary of the Connecticut Bankers Association, scoffs at the idea that loads of pissed-off consumers will soon be switching their money out of giants like Bank of America to protest new fees.
He says he hasn’t heard much at all about such a movement, “other than what’s being played up in the media.”
John Holt, on the other hand, thinks the whole idea of a National Bank Transfer Day (organizers are targeting Nov. 5) is an awesome idea.
That’s because Holt is president and CEO of Nutmeg State Federal Credit Union, a Rocky Hill-based community financial institution, one of many small credit unions and banks hoping to cash in on growing consumer disgust with new fees giant banks are planning to put on things like debit card usage.
“You better believe it,” Holt laughs when asked if he sees this as an opportunity to attract lots of new customers.
The trigger for this anti-Wall-Street-esque effort to get people to move their accounts to smaller, community credit unions and banks was Bank of America’s announcement that it will slap a new $5-per-month fee on most small depositors’ debit card use beginning in 2012. The fees will apply to debit card purchases.
The organizer of Bank Transfer Day, Kristen Christian, insists on her Facebook page that, while she “acknowledges the enthusiasm from Occupy Wall Street,” it wasn’t inspired by and isn’t associated with the protests that have spread from New York City across the nation.
But supporters of the anti-Wall Street movement, like Paul Angelo of Occupy New Haven, believe the Bank Transfer Day concept very much fits with their own goals. Angelo says he and other protesters have been handing out information at farmers markets and on college campuses in an effort to get people to switch their money out of major banks.
“Generally, I don’t think boycotts have a large impact,” Angelo says. “But if you’re taking money permanently out of big multi-national banks ... and if you get enough of a mass of people to do it, especially on one day, it could have impact.”
The reform legislation (partially named for one of its key sponsors, former U.S. Sen. Chris Dodd of Connecticut) allows the feds to regulate how much banks with more than $10 billion in assets can charge in interbank debit-card fees. Small banks and credit unions don’t have those kinds of enormous assets so they’re not covered by the new law.
Up to now, the fees on each debit-card purchase has been about 44 cents per transaction. Federal regulators say that, beginning in 2012, the limit on those fees will be about 24 cents per transaction — which activists say would still give the banks a profit of at least 19 cents for each transaction.
Bank of America officials say that charging the new fee will allow the company to “continue to offer the service and convenience customers have come to expect from Bank of America.”
The Bank Transfer Day effort was begun by Christian, who insists she has no financial stake in the campaign other than her own decision to get her money the hell out of Bank of America and into a local California credit union.
Connecticut Banking Commissioner Howard F. Pitkin says his office has already seen at least a small increase in the number of irate calls coming in from consumers angry over the planned big-bank fee increases.
Pitkin says the uproar over fees on debit-card purchases “certainly could be” a boost for smaller community banks and credit unions. He says his staff gives such irate callers a contact list of state-charted local institutions in their area. “We look at community banks as providing personalized service,” he adds.
Holt thinks nonprofit community institutions like credit unions are a perfect solution for people fed up with huge banks and rising bank fees.
And Angelo agrees. He says he’s planning to switch his own Wells Fargo account to a credit union on Nov. 5.
“I hope it makes an impact,” he says.
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