Bank Transfer Day has customers leaving corporate banks
It's moving聽day聽for聽bank聽customers.
A grassroots movement that sprang to life last month is urging聽bank聽customers to close their accounts in favor of credit unions by Saturday.
The spirit behind "Bank聽Transfer聽Day" caught fire with the Occupy Wall Street protests around the country and had more than 79,000 supporters on its Facebook page as of Friday. The movement has already helped beat back聽Bank聽of America's plan to start charging a $5 debit card fee.
It's not clear to what extent the聽banking聽industry's about-face on debit card fees will extinguish the anger driving the movement. But many supporters say their actions are about far more than any single complaint.
"It's too little, too late," said Kristen 海角大神, the 27-year-old Los Angeles small business owner who started "Bank聽Transfer聽Day." She already opened accounts at two credit unions in preparation for cutting ties with聽Bank聽of America this weekend.
"Consumers are waking up and seeing that they have options," she said.
Even with its public support, however, it's not likely that any account closings that take place on Saturday will make a big dent with industry titans such as Chase, which is the largest聽bank聽in the country with some 26.5 million checking accounts.
But the call to action shows just how incensed consumers were at the prospect of a debit card fee at a time of so much economic uncertainty. Even those who were appeased by the industry's reversal may have tapped into a new sense of empowerment.
That's the case for Dan Blakemore, a聽Bank聽of America customer for the past 10 years. He said he no longer plans to close his checking account now that the debit fee has been scrapped. But he'll be on the lookout for any other changes that might hit his wallet.
"I'm pretty confident they're going to find some way to get that extra money," said Blakemore, a 28-year-old who works for a nonprofit fundraiser in New York City. "I'll just have to see if it offends my sensibility enough to close the account."
Bank聽of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. are keeping mum on whether they've seen an uptick in account closures in recent weeks. But credit unions and small community聽banks聽have been basking in the spotlight and issuing press releases highlighting what they say are superior interest rates and more intimate service, along with tips on how consumers can聽transfer聽accounts. They haven't been shy about the surge in new business they're enjoying either.
Navy Federal Credit Union, the largest credit union in the country, says new account openings in September and October were up 38 percent from a year ago. National Capital聽Bank, a two-branch community聽bank聽in Washington, D.C., says the vast majority of its new account openings in recent weeks have been by fed up聽Bank聽of America customers.
"The debit fee was definitely a driver," said Noah Wilcox, president of Grand Rapids State聽Bank聽in Minnesota, which is also enjoying a lift in account openings.
Because credit unions and community聽banks聽vary so greatly in size, however, it's hard to gauge the total scope of the defections they're reporting. For example, the Lower East Side People's Federal Credit Union in New York City says it's enjoying more than 55 new account openings a week. That's a big jump from its average of about 10 new accounts per week, but insignificant when weighed against the portfolios of the nation's largest聽banks.
Big聽banks聽have also learned that customer grumblings don't always translate into action. That's particularly true for those who have multiple accounts, direct deposit and automatic bill pay; many decide that switching just isn't worth the hassle.
"People will do a lot of complaining before they actually uproot and move," notes Mark Schwanhausser, a聽banking聽analyst with Javelin Strategy & Research.
The recent firestorm over debit card fees was "in a class of its own" because customers saw it as a charge for accessing their own money, he said.
The timing of聽Bank聽of America's fee announcement was unfortunate on multiple levels as well. In addition to the anxiety many are feeling amid high unemployment and stagnant wages, the news broke just as the Occupy Wall Street protests were capturing the national spotlight.
And big聽banks聽have been a key target for Occupy Wall Street, which has tapped into the lingering resentment many harbor over the role ofbanks聽in the financial meltdown of 2008.
Last month, two dozen Occupy Wall Street protestors were arrested when they entered a Citibank branch in New York City and refused to leave. Protestors have also banged drums and demonstrated outside聽bank聽branches in other cities; PNC聽Bank聽twice closed branches in downtown Pittsburgh last week after protestors entered.
But those are the extremes. Schwanhausser of Javelin said many customers will likely be placated by the industry's white flag on debit card fees.
"People are people going to look at that Nov. 5 date and say 'We made our point'," Schwanhausser said
The聽banking聽industry may feel the same way; representatives for聽Bank聽of America, Chase, Citi and Wells Fargo indicate they haven't done anything to prepare branch employees for a surge in account closings this weekend. Then again, many of the closures may have already taken place.
Molly Katchpole, a 22-year-old nanny in Washington, D.C., who started an online petition urging聽Bank聽of America to drop its debit card fee, says the聽bank's聽about-face won't win her back.
"The damage is done," said Katchpole, who has since joined a credit union in Washington, D.C.
