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The Financial Brand Forum 2016 | May 16-18 | Cosmopolitan of Las Vegas

Big Bank Customers Pay For Branch and ATM Convenience

Many large banks have mothballed their free checking products because consumers seem willing to pay fees for the convenience of branch and ATM locations. But as branches become less relevant for many consumers, big banks will once again feel compelled to reintroduce free checking.

By Rob Rubin, Managing Director, Novantas

Over the last few years, most national banks have eliminated free checking. Today, there are 14 banks with 1,000 or more branches and only 3 of these institutions offer free checking. In May 2013, FindABetterBank had 66 community banks and credit unions listed on the site and nearly all offer free checking products.


Codigo | Branch Transformation Report

( Read More: The Tightrope Between Checking Fees and Consumer Defections )

Many national banks have been able to eliminate free checking because some consumers have been willing to trade fees for branch and ATM convenience. In fact, among consumers choose checking accounts with monthly service fees of $20 or more, they are twice as likely to cite “convenient branch locations” as a decision factor vs. other shoppers that chose free checking accounts.


Codigo | Branch Transformation Report

( Read More: Credit Union Study Says Switchers Looking for Truly Free Checking )

So does that mean the larger banks are trend setters — the leading edge of the curve? Will community banks and credit unions begin eliminating their free checking accounts too? Probably not.

Smaller institutions will continue to rely on free checking products for customer acquisition because they can’t charge fees for the convenience of the branches and ATM networks they don’t have. However, looking out five to 10 years — as fewer and fewer consumers care about branch locations — big banks will dust off their free checking accounts because their expansive networks won’t be the valuable commodity they once were with consumers.

Please visit Novarica read more about the role of bank branches in consumers’ purchase decisions.

Insights from Rob RubinRob Rubin is Managing Director of Novantas Data Services. His research leverages insights captured from thousands of bank shoppers every day while they are actually thinking about- and in the process of shopping for a new bank.

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The Financial Brand Forum 2016 | May 16-18 | Cosmopolitan of Las Vegas


  1. Tim Bunch says:

    I totally agree, Rob. The real killer here is the direct banks. With new and superior mobile products being delivered by companies like GoBank and Simple, the branch has to prove it’s value to a new generation.

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