Several weeks ago USA Today posted an article on the probable demise of free checking accounts by large banks as a result of lost revenue from recent regulatory changes. The Wall Street Journal had also posted a similar story back in July of this year. The large banks are no longer earning the same amount of fee income on services like overdrafts and credit cards. The largest source of fee income, checking account overdrafts, has been reduced due to "opt-in" provisions now in effect that require a consumer's prior authorization to allow debit card transactions to post on insufficient balances, causing an overdraft fee in the process.
The good news is that North Alabama Educators Credit Union has no plans for adding a monthly service fee on checking accounts. We have not lost fee income from the various new regulations because we were not charging the fees in the first place. Now that there is an "opt-in" provision required for allowing overdrafts on debit cards, we are looking at allowing debit card overdrafts for those members who have specifically authorized us in advance to do so. Members are always advised to spend money within their means and to avoid unnecessary fees, but emergencies can occur that require access to additional funds for a reasonable fee.
Here is a link to the USA Today article: http://www.usatoday.com/money/industries/banking/2010-10-23-free-checking-accounts_N.htm
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