Banks Free Checking
Banking has changed a lot in the last few years. If you’re still paying for services like checking, you need to re-evaluate your account and your bank. Banks have historically offered free interest bearing savings accounts, but charged service fees for checking. This was because checking accounts required more work on the bank’s part. They had to hire tellers to handle simple transactions like deposits, withdrawals and check cashing. More staff was required to process checks that came in from other banks on their customers’ accounts. Someone had to report back to the customers in the form of a monthly statement. And all of this is if nothing goes wrong. What if a customer has a question or a complaint? What if they bounce a check? Banks started adding fees to cover their costs for these types of things.
Financial transactions have changed significantly, and banks are responding. Cash is nearly a thing of the past. Paper checks are almost as rare. Consumers pay for everything with cards now. You can use a credit card or an ATM card to buy almost anything at any price point. You can put a down payment on a car or a house with plastic. You can pay for a pack of gum or hamburger the same way. Whether you charge it to a credit card and then pay the credit card bill from your checking account, or you pay with your atm card, all of these day to day transactions are now electronic. No paper ever changes hands. Many customers access their bank accounts online.
All of this translates into lower costs for the banks. They have to invest in software and atm machines, but that’s much more affordable in the long run than manhours. They could keep the checking fees in place and make more money, but instead they’re offering checking services for free.
Banks have tried to offer free checking in the past. Like any other type of business, they’re willing to take a loss on the product or service that brings in new customers. Once a consumer has a checking account with a bank, they’re likely to go to that same bank for more expensive products like credit cards and home loans. Being able to count you as their customer is worth a lot to banks. Many banks have offered free checking as a limited time promotion, sometimes when opening a new branch. To keep costs in check, they’ve sometimes put restrictions on the free checking, like high minimum balances or limited numbers of transactions.
Free Online Checking Accounts
Not anymore. Current restrictions are aimed at keeping costs low, but they’re no longer an inconvenience to their customers. Many banks require that you have your paycheck deposited electronically to keep the checking account free. No problem there. You didn’t want to stand in line with your paycheck anyway. Some banks are now offering free checking if you will forgo paper statements and just access your account information online. This saves the cost of paper and postage. And customers love the idea of going paperless.
It’s easy to find free online checking accounts with a variety of banks. Make sure you understand what you need to do in order to avoid service charges. This includes the obvious, like don’t bounce checks. Then sign up for your free bank account and don’t worry about fees any more.