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Will the U.K. Abolish Checks?

April 20, 2011 By Banking.com Staff 1 Comment

The use of paper checks is declining as consumers move to an online world of e-bills and reoccurring Web payments. The U.K. in particular has seen such a steep decline in the use of checks that the Treasury proposed eliminating checks. However, despite the change from paper to online, small businesses, charities and consumer groups have protested this move as they still rely heavily on paper checks.

The U.K.’s Payments Council, which operates independently of the Treasury, is planning to vote on the abolishment of checks, beginning in 2018.

Bank Technology News reported, “There also seems to be a war of sorts brewing between the Treasury and the Payments Council—the Treasury is for evidence of trends in likely check usage over the next ten years, the advantages and disadvantages of abolition and asking the Payments Council on submissions on whether it’s accountable for the impact of its decisions on consumers.”

Do your customers and members still rely on checks? What are your thoughts on abolishing checks?

Filed Under Industry News Tagged With checking, checks

A Bouncing Debit Card?

March 7, 2011 By Banking.com Staff Leave a Comment

While many consumers enjoy the benefits and convenience of debit cards, some banks across the country are beginning to consider allowing debit cards to “bounce” – similar to how a check would not clear.

According to the Wall Street Journal, with new rules and regulation in place, banks are now restricted on how much they can charge merchants for debit transactions, with the end result being a loss of billions in revenue.

Some are considering dividing debit services into components and charging for each separately, at the cost of the merchant. This turns the table on retailers, who according to the post, “won a significant victory with the enactment of debit-transaction fee limits.”

Is your institution considering allowing debit cards to “bounce?” Leave us a comment below.

Filed Under For Financial Institutions Tagged With checking, debit card fees, debit cards

Free Checking May Become a Luxury of the Past

January 19, 2011 By Banking.com Staff Leave a Comment

Due to recent changes in debit and credit card fees from the Dodd-Frank bill and the CARD Act respectively, banks are looking to replace traditional sources of fee income. Some banks and credit unions are beginning to charge for checking accounts that, in recent years, were provided to customers for free.

According to recent reports from the Wall Street Journal and New Jersey’s Star-Ledger, Bank of America will begin testing $6 a month fees and J.P. Morgan Chase and Wells Fargo will begin phasing out free checking in New Jersey.

While these fees may keep banks out of the red, a recent survey by BAI & Finacle Index of Bank Sentiment suggests that consumers are not ready for this change. Some of the key findings from the survey are below:

• 85 percent of consumers surveyed do not expect to pay fees for a checking account.
• 44 percent of respondents state that fees charged by banks are reasonable but 42 percent remain neutral about the fairness of fees.
• Only 45 percent of respondents say they are saving money for the future, which is down 6 percent from the February 2010 index.
• They still don’t trust the financial industry as a whole. About 37 percent of respondents indicate they see banks as trustworthy; this is up from 33 percent six months ago but remains a low number.
• They’re trying to reduce their debt. 55 percent of respondents to the most-recent index say they intend to pay off some or all of their credit cards.

Detailed information on the survey is available here.

What are your thoughts on implementing fees for checking accounts? Let us know in the comments section below.

Filed Under Surveys Tagged With checking, statistics, survey