Four Banks With Free Checking Accounts And Debit Cards

Lately, larger sized banks have begun to charge a monthly fee (or have increased their monthly fee) for debit cards and checking accounts. For example, Bank of America added a $5 monthly debit card fee, and CitiBank has added a $15 to $20 checking account fee. These hidden fees have been put into place to compensate for a substantial loss of profit due to the Wall Street Reform & Consumer Protection Act that Congress passed in 2010.

This bill cut a bank’s profit from 44 cents to 23.9 cents when a debit card from that bank was swiped by a consumer. The change was lobbied by merchants with the intention of decreasing the cost for businesses and, ultimately, their customers. While merchants were pleased with the bill that lowered debit card transaction costs, large banks that made a profit off of debit card swipes were not too pleased. With the cutback on the amount of money that was to be charged per swipe, banks began to see a descending profit margin. To compensate, many banks have added or increased fees on many of their services, including debit cards and checking accounts.

Banks have an even more furtive reason for the fees as well. By making the customer pay an upfront fee, they are hoping to have them switch from a debit card to a credit card through the bank. Credit cards may not have many upfront fees, but the charges add up quickly and the debt then has interest added on top of it. Banks have a high profit margin on the interest that their customers pay, making credit cards more profitable than debit cards. Having customers switch from debit to credit is a sneaky way for banks to make up for lost profits on debit card charges. Creating large fees on debit cards and checking accounts to have customers switch is seemingly unethical. The switch should be a customer-only decision and should not have to be based on the fact that they are having to pay to use their debit card or maintain their checking account.

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The trend of creating and increasing fees is projected to continue. While Congress was working on the legislation for the bill in 2010, big banks warned that they would increase their fees. Banks lose an estimated $1.3 billion monthly with the transaction fees cut by just over half. Creating unnecessary fees creates a big problemĀ for many clients of the bank who cannot afford the increase.

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As bad as all this sounds, the good news is there are still a few banks that do offer 100% free checking accounts.

Banks with Free Checking

To protest these fees, customers can take their business elsewhere. But where should you, as the customer, go? There are quite a few options with many banks that offer free checking and low fees for their services. Of these many banks, fourĀ of them stand out above the rest.

1. EverBank

Founded on the value of opportunity, EverBank has some of the best offers and currently doesn’t have any fee’s. The bank offers interest on accounts, will reimburse ATM fees, and even offers $60 for customers to switch to them.

EverBank currently has the following fees:

  • Monthly Account: $0
  • Debit Card: $0
  • Opening Deposit: $1,500
  • Checks: free
  • ATM: none if account balance is over $5,000, EverBank will reimburse fees to use other bank’s ATMs.
  • Interest: EverBank’s interest rates are within the top 5% that all banks offer nationally. This rate is guaranteed.
  • Cashback Rewards on Debit Cards: n/a

2. USAA

The USAA offers its fiscal expertise to active military members, veterans, and their family members. Aside from banking, the USAA offers services in insurance, investment, and retirement. USAA members also receive a variety of benefits ranging from travel discounts to home buying services.

USAA currently has the following fees:

  • Monthly Account: $0
  • Debit Card: $0
  • Opening Deposit: $0
  • Checks: free
  • ATM: none on the first 10 withdrawals and a refund of up to $15 per month for fees from other bank’s ATMs
  • Interest: Accounts over $1,000 will earn a competitive interest rate
  • Cashback Rewards on Debit Cards: n/a

3. Capital One 360

Capital One 360 offers a variety of online banking options. Capital One has over 40,000 ATMs nationwide and allows customers to utilizes their smartphones or online access via computer to deposit checks and pay bills.

Capital One 360 currently has the following fees:

  • Monthly Account: $0
  • Debit Card: $0
  • Opening Deposit: $1
  • Checks: free
  • ATM: none at any of their 40,000+ ATMs
  • Interest: Accounts can earn up to 0.9% annually on their balance
  • Cashback Rewards on Debit Cards: n/a

4. Ally Bank

Ally Bank is a larger, national bank that does its business right. They value customer service and put their consumers first. Ally Bank runs on the core values of looking externally, executing with excellence, acting with professionalism, and delivering results.

Ally Bank currently has the following fees:

Monthly Account: $0
Debit Card: $0
Opening Deposit: $0
Checks: free
ATM: none – they will cover fees charged by other banks
Interest: Ally Bank offers customers up to 0.6% interest on their account
Cashback Rewards on Debit Cards: n/a

These four banks all have free checking and have little to no fees. Their services are exactly the same as larger banks that are charging larger and larger fees. Keeping your money in a safe place should not come with a hefty fee. Ally Bank, Capital One 360, USAA, and EverBank offer substantial rates that are competitive, have few fees, and offer services at a low cost to you. Switching to any of these banks with free checking can save you the money and time that other banks are trying to take away from you without you knowing.

A Note on Credit Unions

In the United States, credit unions are not-for-profit organizations that lend money to their customers and offer savings options. Since credit unions are not looking to make a profit or please their shareholders, they tend to offer their members significantly lower interest rates on loans. Credit unions also offer higher interest rates than a traditional bank on savings and checking accounts, meaning a larger annual yield percentage for the customer.

Credit unions often also have low fees on their products and offer free debit cards and checking accounts. Credit unions vary based on location and can be found throughout the nation by simply searching online for them. Joining a credit union is another viable option to avoid large fees banks are charging for debit cards and checking accounts among other services.

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