If a business does everything in its power to let you know that they don’t want you as a customer, would you stay or would you go?
The big banks have signaled one after another their intention to raise fee upon fee for checking account customers. I didn’t initially think about this angle, but an insightful article in USA Today explained that the banks are actually trying to get low-profitability customers to leave by feeing them to death.
Why would they do this? The reality is that they don’t want you unless you carry huge balances. You’re simply not worth it to them. The predictions I’ve seen say that the market share the big banks hold in consumer checking will drop from 45% to 35% in a relatively short period of time as a result of all the fees.
Basically, the big banks want to put their low-profitability customers into a penalty box of high fees and red lights. And when I say red lights, I mean that almost literally. When you call up a giant bank, a color typically pops on the customer no service rep’s screen that lets them know if they should help you or not, based on how much profit you represent to them.
They won’t help you if you’re not in the “green,” both on the screen and in your finances. You need to have north of $50,000 in a checking account to be considered a profitable customer.
If you don’t have north of $50,000, it’s best for you to leave. If you stay, your reward will be an ever increasing menu of fees. So why not take the hint? Join a credit union, a small community bank or take your money to a discount stockbroker that offers a checking account option. They’re much more likely to value your business.