Bank of America faces backlash after eliminating free checking

Randal Sanchez
January 26, 2018

Bank of America is ending its free checking option, upsetting some customers enough that they've vowed to close their accounts.

Those customers have now been transferred to a BofA core checking account that costs them $12 monthly unless they carry a daily balance of $1,500 in the account or use direct deposit.

Bank of America hasn't offered the eBanking account to new customers in almost five years, but customer who were grandfathered in to the program were not required to keep a minimum balance so long as they received their monthly statement online and used automated teller machines for withdrawals and deposits.

A petition has garnered more than 86,000 signatures, urging Bank of America to not end fee-free checking accounts.

"Low income families and seniors utilize this service specifically in order to make their few pennies stretch further", one petition-signer wrote in the comments section.

The eBanking checking account, which waived the monthly fee of $8.95 if customers switched to paperless, will no longer exist.

It's not just Bank of America customers who are shelling out extra cash in fees.

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The previous low was held by Bill Clinton, whose first-year average stood 10 points higher than Mr Trump's, at 49 per cent. The tax cut "will be good for the short-term, but it doesn't fix the fundamental problems" in the US economy.

The bank introduced eBanking accounts in 2010 and stopped offering them in 2013.

I asked Bank of America why it didn't move its no-fee clients into that account. I have very low income to sometimes no income. The nation's second-largest bank, with over 100 branches and ATMs in the Chicago area, does have a more reasonably priced checking account called SafeBalance.

"Bank of America was known to care for both their high income and low income customers", the petition stated. "I don't expect that's going to change anytime soon".

By the way, this isn't the first time Bank of America has faced a customer backlash.

This lack of banking options forces the un-banked to use other financial services, including currency exchanges - a business that's poised to get a very nice raise from the Rauner administration.

At the risk of incurring the wrath of free-market types everywhere, my answer is: You bet.

Analysts at KBW predict Bank of America's earnings will increase 17.8 percent in 2018 once the tax cut is factored in, compared to an expected 13 percent earnings increase for banks overall. "That wouldn't even cover the maintenance fee", the petitioner stated.

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