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| Image from flickr.com by Robert Blackie |
If you read personal finance blogs a lot like I do, one common complaint you will find is the way that people are treated by the giant monster mega banks. It seems customer service has fallen by the wayside. Customers are treated less and less like human beings, and more like profit tokens for the banks. Think of yourself as a game piece on a board game like Monopoly and the banks are the players of the game. If your piece (you) is not making money for the player (the bank), the player will lose and your piece will be discarded. Relating this to real-life, banks don’t want customers who aren’t causing them to profit so they do everything they can to drive them away.
There are several banks that fall into the category of giant monster mega banks. Most notably is Bank of America, who recently made news by attempting to invoke a $5 monthly fee for customers who use debit cards. After a major backlash of complaints, Bank of America succumbed to demands by their customers and dropped the monthly fee. Bank of America wasn’t the only bank willing to mistreat their customers as other banks were standing by waiting to follow suit.
How did the giant monster mega banks get so big and why do so many people continue to do business with them if they are continually mistreated?
In a recent post on Money Spruce, it was brought up that one reason people stay with the big banks is because of the easy access to many ATM’s. In my comment on that post, I mentioned the reasons I thought that was ridiculous. How often do people really need to use the ATM these days anyway?
I think I have a pretty good idea how the mega banks got to be so big. Let me give you a clue. It was NOT by providing excellent customer service and slowly building up a good reputation and customer base. Their television commercials say otherwise, as this is what they would like for you to believe.
I don’t claim to know how all of the banks got to be so big, but I do know how I became a member of one of the banking giants. It was not on purpose. Allow me to explain...
At age 18 I headed off to college and opened my first checking account on my own. This was during the mid 90’s, before the emergence of debit cards, and ATM availability was an important factor in choosing a bank for me. I went with a bank called First of America, which was a regional bank that had locations all over Michigan.
Eventually, First of America was bought out by National City, a Cleveland based bank. Virtually all of the First of America branches transformed and I was now part of a slightly bigger regional chain of banks. Soon thereafter, the debit card was born and I was issued my first one by National City. Years later, National City came out with a rewards program (called Points) and I was happy as could be. They were basically paying me to use my debit card for everyday purchases that I made anyway!
In the fall of 2008 the massive government bank bailout, under President George H.W. Bush, happened. PNC Bank was one of the banks that received bailout funds and they used some of these funds to purchase my bank, National City. I was less than pleased, as I opposed any and all of the government bailouts. I wanted nothing to do with any company that accepted government bailout funds. If I were stupid enough to buy a new car, I would have purchased a Ford because they were the only car manufacturer of the “big three” that did not accept bailout money.
So there I was, now an involuntary member of a giant monster mega bank. As a matter of principle, I should have closed my account immediately. But I didn’t, as the hassle factor of changing everything associated with my main checking account would have been too great. My paycheck from my day job is direct deposited there. My investments and my life insurance payments are automatically withdrawn from that account each month. All of my bills that I pay online have saved account information that coincides with the debit card on that account. My PayPal account is linked to that account. It just would have been too great of a hassle to change all of that, so I stayed.
Thus far, I have not been unhappy with PNC Bank. I will likely stick with them until they really piss me off. They came close when they tried to charge me a $6 fee for making more than 4 withdrawals from my savings account one month. Apparently this was a new fee incorporated by PNC and was hidden within the fine print on some documents that were sent during the transition. I had been using that savings account for Christmas savings, and made more than 4 withdrawals within the month before Christmas. It only took a phone call to get the fee reversed, as I pleaded that I should not have to pay a fee to get MY money!
More recently, PNC Bank had to do away with the Points rewards program for “free checking” account holders. This was due in part to new government regulations that limited the fees that banks can collect from merchants for debit card purchases. Although I appreciated and became accustomed to the rewards I got through the Points program, this was not a deal breaker for me. Now I have just a regular, free checking account, like I used to have, with no rewards program.
Do you do business with one of the giant monster mega banks? Are you happy or unhappy with them?
References:
USA Today - Bank of America Drops Debit Card Fees
USA Today - PNC used bailout funds to buy National City
There are several banks that fall into the category of giant monster mega banks. Most notably is Bank of America, who recently made news by attempting to invoke a $5 monthly fee for customers who use debit cards. After a major backlash of complaints, Bank of America succumbed to demands by their customers and dropped the monthly fee. Bank of America wasn’t the only bank willing to mistreat their customers as other banks were standing by waiting to follow suit.
How did the giant monster mega banks get so big and why do so many people continue to do business with them if they are continually mistreated?
In a recent post on Money Spruce, it was brought up that one reason people stay with the big banks is because of the easy access to many ATM’s. In my comment on that post, I mentioned the reasons I thought that was ridiculous. How often do people really need to use the ATM these days anyway?
I think I have a pretty good idea how the mega banks got to be so big. Let me give you a clue. It was NOT by providing excellent customer service and slowly building up a good reputation and customer base. Their television commercials say otherwise, as this is what they would like for you to believe.
I don’t claim to know how all of the banks got to be so big, but I do know how I became a member of one of the banking giants. It was not on purpose. Allow me to explain...
At age 18 I headed off to college and opened my first checking account on my own. This was during the mid 90’s, before the emergence of debit cards, and ATM availability was an important factor in choosing a bank for me. I went with a bank called First of America, which was a regional bank that had locations all over Michigan.
Eventually, First of America was bought out by National City, a Cleveland based bank. Virtually all of the First of America branches transformed and I was now part of a slightly bigger regional chain of banks. Soon thereafter, the debit card was born and I was issued my first one by National City. Years later, National City came out with a rewards program (called Points) and I was happy as could be. They were basically paying me to use my debit card for everyday purchases that I made anyway!
In the fall of 2008 the massive government bank bailout, under President George H.W. Bush, happened. PNC Bank was one of the banks that received bailout funds and they used some of these funds to purchase my bank, National City. I was less than pleased, as I opposed any and all of the government bailouts. I wanted nothing to do with any company that accepted government bailout funds. If I were stupid enough to buy a new car, I would have purchased a Ford because they were the only car manufacturer of the “big three” that did not accept bailout money.
So there I was, now an involuntary member of a giant monster mega bank. As a matter of principle, I should have closed my account immediately. But I didn’t, as the hassle factor of changing everything associated with my main checking account would have been too great. My paycheck from my day job is direct deposited there. My investments and my life insurance payments are automatically withdrawn from that account each month. All of my bills that I pay online have saved account information that coincides with the debit card on that account. My PayPal account is linked to that account. It just would have been too great of a hassle to change all of that, so I stayed.
Thus far, I have not been unhappy with PNC Bank. I will likely stick with them until they really piss me off. They came close when they tried to charge me a $6 fee for making more than 4 withdrawals from my savings account one month. Apparently this was a new fee incorporated by PNC and was hidden within the fine print on some documents that were sent during the transition. I had been using that savings account for Christmas savings, and made more than 4 withdrawals within the month before Christmas. It only took a phone call to get the fee reversed, as I pleaded that I should not have to pay a fee to get MY money!
More recently, PNC Bank had to do away with the Points rewards program for “free checking” account holders. This was due in part to new government regulations that limited the fees that banks can collect from merchants for debit card purchases. Although I appreciated and became accustomed to the rewards I got through the Points program, this was not a deal breaker for me. Now I have just a regular, free checking account, like I used to have, with no rewards program.
Do you do business with one of the giant monster mega banks? Are you happy or unhappy with them?
References:
USA Today - Bank of America Drops Debit Card Fees
USA Today - PNC used bailout funds to buy National City
