Is Free Checking a Thing of the Past?

(This article first appeared in the May-June 2018 issue of The American Postal Worker magazine) 

Bank of America, the country’s second largest bank, ended its popular free e-checking account and is now requiring customers to maintain a minimum balance of $1,500 or a monthly direct deposit of at least $250. Customers who fail to meet those minimums will be charged a $12 monthly fee. 

Low-balance bank customers in New York spend an average of $73 a year on maintenance and transaction fees, according to “Take it to the Bank,” a 2015 report released by the New York City Department of Consumer Affairs. The Bank of America policy could double that burden.

The announcement came on heels of new federal tax legislation which is set to benefit Bank of America to the tune of $3.5 billion. The bank’s revenue in 2017 was $93 billion, with a profit of $21 billion. Brian Moynihan, Bank of America Chairman and CEO, earned $20 million in 2017.

“Just weeks after getting a windfall from Trump’s tax bill, Bank of America is insisting that it needs to hike fees on checking accounts, a move that will hurt its most vulnerable customers and exacerbate inequality,” Jennifer Epps-Addison, Co-Executive Director of the Center for Popular Democracy, declared in a press release from the New York City Comptroller’s office. “This is an outrageous move that we will resist at all costs, and just one more example of why we need to insist on more accountability and oversight for banks and other financial institutions.”

“Bank of America's decision is also one more argument for postal banking,” said APWU President Dimondstein. “The working people of the United States need affordable, accessible financial services.”

Taking Postal Banking to the Streets 

The Campaign for Postal Banking launched petition campaigns in three cities: Baltimore, MD; Bronx, NY and Cleveland, OH. APWU local leaders – Baltimore Francis Stu Filbey Area Local President Sherry C. McKnight, New York Metro Area Local President Jonathan Smith and Cleveland Area Local President Daleo Freeman – are working with our sister postal unions, the local labor movement, and community and religious groups to collect signatures demanding that the USPS bring financial services to these areas now.

A shocking 21.8 percent of Bronx households do not have a bank account. An additional 30.5 percent have a bank account but also use at least one "alternative" or non-bank financial service, including money orders, check cashing, pawn shops, car title loans, etc. 

"I'm so fired up about the Bronx Campaign for Postal Banking," said Smith. "Postal banking is a win-win-win for the people of the Bronx, the New York Metro Area Postal Union, the APWU and the Postal Service itself. We need to get this done!”