Study: Americans care about checking fees—but often don’t check for them
Checking accounts are among the most basic, widely available financial products in existence, but how much attention does the average American pay to his or her checking choices? Not as much as you might think, according to a new study.
The Consumer Banking Insights Survey—commissioned by Kasasa® in conjunction with more than 200 community banks and credit unions, and conducted online by Harris Poll in December 2013 among more than 1,000 U.S. adults (ages 18 and up)—found that, 92 percent of Americans have at least one checking account, and of them, 64 percent use those accounts as their primary method of payment.
Yet, while most Americans have a checking account, few spend a lot of time evaluating whether their accounts are meeting their needs. The lack of attention could explain why many consumers, especially those who use a megabank, say they feel taken advantage of by fees.
Americans care about fees, but don’t always check for them
Many consumers appear to pay little attention to their checking account choices. Few report performing an annual financial assessment of their account, and some consumers have never checked to see whether their checking account is charging them fees. The survey found that, often, what consumers say they’re looking for in terms of fees from their checking financial institutions doesn’t align with what they’re actually getting.
Among checking account holders:
- Only about 1 in 3 (36 percent) perform annual financial assessments on their checking accounts.
- 15 percent have never looked to see whether their checking account charges fees.
- Another 23 percent haven’t checked their checking account for fees in six months or longer.
- Less than half (45 percent) have checked their primary checking account for fees in the last month.
- While 92 percent say few or no fees on checking and saving accounts is important to them, only 44 percent have unconditionally free (i.e., no minimum balance or direct deposit requirements) primary checking accounts.
Megabank customers fare worse
When compared to community bank customers and credit union members*, megabank customers* are less likely to have spent a lot of time researching or paying attention to their checking account choices. Some megabank customers also report feeling taken advantage of by their financial institutions’ fees and are more likely than community bank and credit union customers to pay fees on their accounts.
- Community bank customers and credit union members are more likely to say they spent a lot of time researching and choosing the right bank (63 percent) than megabank customers (43 percent).
- 40 percent of community bank customers and credit union members report performing an annual financial assessment of their account, versus just 30 percent of megabank customers.
- 56 percent of community bank customers and credit union members have free, unconditional checking, versus just 26 percent of megabank customers.
- While 98 percent of megabank customers said few or no fees on checking and saving accounts is at least somewhat important to them when choosing a bank, 42 percent of them report feeling that their primary bank takes advantage of them with all of the fees. Among community bank customers and credit union members, only 22 percent feel the same.
- While 26 percent of megabank customers said their checking was unconditionally free, 38 percent of them haven’t checked for fees in six months or more, if ever.
About the Consumer Banking Insights Study
More than 200 community banks and credit unions teamed up with Kasasa to conduct the first Consumer Banking Insights Study, which was executed online by Harris Poll from Dec. 26-31, 2013. The study polled 1,020 U.S. adults ages 18 and up to gauge their banking and checking preferences, feelings and behaviors. Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents’ propensity to be online.
*Throughout this report, “megabank customers” are checking account holders who consider one of the big national banks to be their primary banking institution, and “community bank customers and credit union members” are those who consider a local community bank or a credit union to be their primary banking institution.