How Banks May Gouge You in 2010

  • A New Era?

    While most of us welcome the new consumer-friendly credit card rules, some may feel that they seem too good to be true. And it turns out their suspicions may be justified.  While the recent credit card reform legislation does provide protections like more notice before rate changes and new fees, and an extra week to make payments, the law may in fact come without negative consequences as well. Prior to recent credit card reform, issuers made $15 billion in penalty fees, the White House noted last year. Since that revenue stream will be diminishing significantly this coming year, banks have been scrambling to come up with way to make up the difference. As banks prepare to take a hit from the Credit Card Accountability, Responsibility and Disclosure Act which goes into full effect this year, consumers should brace themselves for a backlash which will also involve checking accounts.  Here are some of the ways you might get gouged. Photo Credit: Ko-An
    No Free Checking
  • No Free Checking

    To make up for other lost profits, free checking could be eliminated completely, The Wall Street Journal reports.  Along with that, free paper checks, reimbursement of ATM fees and other perks that some free checking accounts have offered may become a thing of the past too. Photo Credit: Betsssssy
    Annual Fees
  • Annual Fees

    Companies issuing credit cards are expected to reinstate annual fees for many customers.  Creditors have charged annual fees in the past, but in recent years they became rare, and a turnoff to consumers.  But these fees are now becoming more prevalent, according to creditcards.com.  If you're already paying an annual fee on a card, don't be too surprised if that fee goes up this year. Photo Credit: xJasonRogersx
    New Fees for Old Products
  • New Fees for Old Products

    In addition to reinstated annual fees on credit cards and more fees on checking accounts, you may also be charged fees for special credit or debit card features like rewards or cash back. Banks may also increase fees charged when you want to stop a check you've written from being processed. Photo Credit: Andres Rueda
    New Fees for New Products
  • New Fees for New Products

    Banks may introduce more customizable accounts that offer a variety of services and benefits like ATM fee reimbursement, no minimum balance required or interest checking for a fee, The Wall Street Journal notes. Photo Credit: laverrue
    Closed Accounts
  • Closed Accounts

    In the same way credit card issuers have cut credit limits and closed credit card accounts with little to no warning, consumer banks may follow suit with checking accounts, especially if they tend to have fairly low balances. Accountholders with large balances are worth more money to them. After all, money from deposits can be invested by banks themselves and earn them interest, notes to HowStuffWorks.com. Photo Credit: swimparallel
    Interest Rate Bait and Switch
  • Interest Rate Bait and Switch

    If you've had what’s now an incredibly low rate on a credit card, and it hasn’t changed even though most cards have been hit with higher rates and fees, don’t expect it to stay that way for long. There's a good chance that you'll be getting a notice in the mail saying that your fixed rate card is becoming a variable rate card, and before long, that rate could rise. The American Bankers Association previously told MainStreet that companies would continue raising interest rates up until new credit card rules officially take effect in February. Photo Credit: TheTruthAbout...
    Charging for Protections
  • Charging for Protections

    As online banking has gained in popularity, bank Web sites have been offering free automated balance alerts and reminders for consumers telling them when their balance is due.  They may start charging money for this.  And shockingly, fraud protections like early warnings could come with a fee as well, the Journal notes. Photo Credit: carbonNYC
    Printed Statement Fees
  • Printed Statement Fees

    While banks have previously offered, say, a $5 bonus if you decide to receive your statements electronically, institutions are now expected to start charging customers for any printed statements.  It was only a matter of time for this to happen.  It appears that they'll be saving even more trees than cutting down on mailing out fewer credit card offers. Photo Credit: bobcat rock
    Inactivity Fees
  • Inactivity Fees

    Consumers may have to purge old, unused or little-used accounts once banks start charging inactivity fees or increase them if they already have them.  More activity on your end, particularly when you’re making more deposits, likely means more profit for banks.  Both Bank of America (Stock Quote: BAC) and Fifth Third Bank have recently surprised customers with inactivity fees, according to the Consumerist. Photo Credit: barbaranixon
    Fewer Rewards
  • Fewer Rewards

    Consumers who are active users of rewards cards may take a hit as well, as creditors water down their programs, according to the Journal.  If you earn points on cards, for example, that could mean it would take more points for you to redeem them for anything worthwhile. Photo Credit: ivanwalsh
    Discouraging Paper Checks
  • Discouraging Paper Checks

    Paper checks take more work and cost banks more money to process than electronic transactions, meaning banks could discourage their use altogether, The Wall Street Journal notes. Some online banks like ING don't even offer accountholders paper checks even now.  And just as banks may start to charge for printed statements, they could charge for the processing of paper checks as well. Photo Credit: Photo Credit: carbonNYC
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