Banks Ditch Free Checking at Breakneck Pace, But Not Credit Unions

An annual study from Bankrate says free checking is alive and well at most credit unions, but banks are running the other direction.

Bankrate.com surveyed the 50 largest credit unions in the U.S. in January 2014. The survey included one checking account (share draft) at each credit union, along with all associated debit card and ATM fees.

72% of America¹s 50 largest credit unions still offer standalone free checking accounts, according to Bankrate’s report. This is almost double the rate at the nation¹s largest banks and thrifts, where the percentage drops down to only 38%. Bankrate defines “free checking” as accounts with zero monthly service fees or point-of-sale transaction fees regardless of balance.

Another 24% of credit unions offer checking accounts that can become free if certain requirements are met (e.g., e-statements and/or direct deposit are the most common fee waivers). That means free checking — in one form or another — is available at a total of 96% of the nation’s largest credit unions.

Since 2010, the availability of standalone free checking at credit unions has declined modestly from 78% to 72%. Meanwhile at banks, the percentage has plummeted from 65% to 38%.

More than half of the credit union checking accounts that Bankrate.com surveyed do not have a minimum opening deposit requirement (54%), and no account required more than $100.

The average non-sufficient funds fee at credit unions is $26.96 vs. $32.20 at banks. The most common is $25 vs. $35 at banks).

30% of credit unions either do not charge their members for using out-of-network ATMs or provide at least one free withdrawal per week. Among the credit unions that assess fees, $1 and $1.50 are the most common amounts compared with $2 at banks.

Almost all credit unions (96%) charge non-members for using the credit union¹s ATMs. The most common fees are $2 and $3. Banks charge a similar $3 fee.

Only 36% of the credit union checking accounts that Bankrate.com surveyed pay interest at the minimum opening deposit, with the average a measly 0.1%.

Credit Union APY Minimum
to Open
Monthly
Service Fee
NSF
Alaska USA FCU N/A $5.00 $5.00 $20.00
Alliant N/A $0.00 $0.00 $25.00
America First FCU 0.05 $0.00 $0.00 $25.00
American Airlines FCU 0.05 $25.00 $0.00 $25.00
Bank-Fund Staff FCU N/A $25.00 $0.00 $30.00
BECU 0.05 $10.00 $0.00 $25.00
Bethpage FCU N/A $0.00 $0.00 $30.00
Citizens Equity First N/A $25.00 $0.00 $25.00
Delta Community 0.02 $0.00 $0.00 $25.00
Desert Schools FCU 0.2 $25.00 $5.00 $35.00
DFCU Financial N/A $20.00 $0.00 $32.00
Digital FCU N/A $0.00 $0.00 $30.00
Eastman 0.05 $1.00 $0.00 $30.00
Ent FCU N/A $0.00 $0.00 $25.00
ESL FCU N/A $1.00 $0.00 $37.00
First Tech FCU N/A $0.00 $0.00 $28.00
Hudson Valley FCU 0.05 $5.00 $0.00 $30.00
Kinecta FCU N/A $0.00 $2.00 $29.00
Lake Michigan N/A $0.00 $0.00 $30.00
Logix FCU N/A $25.00 $2.95 $29.00
Mountain America FCU N/A $0.00 $2.00 $25.00
Navy FCU 0.05 $0.00 $0.00 $29.00
Northwest FCU N/A $0.00 $0.00 $32.50
OnPoint Community N/A $50.00 $0.00 $30.00
Patelco N/A $0.00 $0.00 $28.00
PSECU 0.1 $0.00 $0.00 $30.00
Pentagon FCU N/A $25.00 $10.00 $30.00
Police and Fire FCU 0.15 $0.00 $0.00 $19.00
Randolph-Brooks FCU 0.05 $0.00 $0.00 $24.00
Redstone FCU N/A $0.00 $0.00 $25.00
San Antonio FCU N/A $25.00 $0.00 $25.00
San Diego County N/A $25.00 $2.00 $27.00
SchoolsFirst FCU N/A $25.00 $0.00 $20.00
Security Service FCU N/A $0.00 $0.00 $27.50
Space Coast N/A $25.00 $6.00 $30.00
Star One 0.25 $100.00 $3.00 $13.00
State Employees 0.25 $1.00 $1.00 $12.00
State Employees FCU N/A $0.00 $0.00 $25.00
State Employees (ME) N/A $25.00 $5.00 $30.00
Suncoast Schools FCU N/A $25.00 $0.00 $29.00
Teachers FCU 0.15 $0.00 $0.00 $30.00
The Golden 1 N/A $0.00 $0.00 $27.50
Tinker FCU N/A $25.00 $0.00 $22.50
Tower FCU 0.05 $10.00 $0.00 $25.00
United Nations FCU 0.05 $0.00 $0.00 $25.00
Virginia N/A $20.00 $0.00 $30.00
Visions FCU N/A $0.00 $8.00 $25.00
VyStar 0.1 $0.00 $0.00 $32.00
Wescom N/A $0.00 $8.00 $30.00
Wings Financial 0.15 $1.00 $0.00 $25.00

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This article was originally published on March 18, 2014. All content © 2018 by The Financial Brand and may not be reproduced by any means without permission.

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