Bank of America is doing away with the free checking account option — often used by people with low incomes — and will now require customers to keep more money in the bank in order to avoid a monthly fee.
via Money Magazine:
The Charlotte, N.C.-based bank this month is moving all of its remaining eBanking customers to standard core checking accounts that charge a $12 monthly fee unless the customer receives a direct deposit of $250 or more or a minimum daily balance of $1,500, the Wall Street Journal reported. The move has been ongoing since 2015.
News of the bank’s decision did not go down well with some customers. A petition to revert the move on Change.org has garnered more than 45,000 signatures as of Monday evening. “Many low income families do not meet these requirements,” the author writes. “There have been times where I’ve only had $10 to my name. That wouldn’t even cover the maintenance fee.”
Banks often charge fees for checking services since accounts can be costly for institutions to maintain despite income from overdraft and other fees. But with this latest move, some Bank of America customers feel the bank is turning its back on its traditional values.
“Bank of America was one of the only brick-and-mortar bank that offered free checking accounts to their customers,” the Change.org petition reads. “Bank of America was known to care for both their high income and low income customers. That is what made Bank of America different. Bank of America was the bank of every American with a dream.”
MONEY also reached out to Bank of America but did not immediately receive a response.
This is not the first time Bank of America has faced backlash over a decision to charge fees. In 2011, the bank toyed with the idea of charging customers $5 a month for making purchases with a debit card, but it eventually opted not to proceed with the plan.
While ending a free checking account option doesn’t sound like a major problem for most, this tweet puts it all into perspective:
$12 per month for a checking account?
If you have $1,000 in the account, $12 is 1.2% of it—per month.
Multiply by 12 months: people without much money are charged an annual rate of 14.4% for the bank to hold their money and process checks. https://t.co/emxDj2Pw3w
— Steve Inskeep (@NPRinskeep) January 23, 2018