Banks are competing with used car dealers for the title of most distrusted. And they wonder why. How long before these fees show up here?
Wrong PIN? That’ll Be $2, Thanks
AUSTRALIA: Banks have hit a new low by charging fees for cancelled transactions and incorrectly entered PINs, the Australian Consumers Association says.
And most consumers did not know the charges existed, said the association’s senior finance policy officer, Nick Coates. “Although no actual transaction goes through, a fee is charged,” he said.
“The fee simply turns up on their account statement at the end of the month, in addition to any regular transaction and administrative fees.” Dr Coates said the fees, from 60 cents to $2, might be charged for entering a PIN incorrectly, choosing the wrong account type, not having sufficient funds or aborting the transaction before completion.
Dr Coates said the fees were a new low in bank charges, illustrating an upward creep of retail banking fees and a creative development in hidden fees.
“They provide a striking example of how the complex network of interchange fees is passed on to consumers in an unfair and unjust manner,” he said. “Our concern though is that the result – consumers paying 60 cents to $2 – is inherently unfair and disproportionately affects vulnerable consumers.”
But the Australian Bankers Association said the consumers association was being misleading. A spokeswoman said only four Australian banks issued such fees, while the association had 26 member banks.
Everyone else is sticking to the customer, why should banks be any different.
2 words….
Credit Union
There’s a Citibank that just opened on a Broadway storefront. There is nobody inside (no bank). Just ATMs with an official Citibank sign shining brightly outside.
All financial institutions and the government are pushing for a cashless society. That way they can charge you money for using your money. Many employers now only do direct deposit for their employees. Again, sure you get paid, but it usually costs you to retrieve the money from the bank.
The biggest insult to me was when I was getting filing a form with the INS. The form cost $95 and they would not take cash. You know, that paper stuff, issued by the government, that says THIS NOTE IS GOOD FOR ALL DEBTS PUBLIC AND PRIVATE . They would only accept checks, drafts, or money orders.
Maybe these people are afraid of any germs on the money.
The highest ideal of a cashless society is one where there is no transaction between items, but rather transactions between people. That means that everyone works for free–no salary, no money, no cash. But that also means that everything is free. If you are hungry you walk into a restaurant, order and eat. And when you are done you walk out by only saying “thank you.” With no money, there can be no accumulation of wealth.
I like the idea that the President’s Choice food brand uses here. They get CIBC to handle your banking, slap their brand on it, and absorb the fees. In exchange, they get to see what you’re buying when you use debit.
Considering the fees I’d normally be charged, I think they’re getting ripped off.
The banks here in Canada are greedy rat bastard weasels as well. I’ve not heard of charges for a cancelled transaction but it will come.
When debit cards were first introduced it was about $.25 a transaction now it is $1.50 – $2.00. As the cost of the equipment to process the transaction has dropped the charges have gone up.
If you have mountains of cash in the bank your service fees are waived. If you are just getting by you pay. It is particularily galling to see the ceo of a bank bleating about another year of record profit as if this was done through shrewd investment and management when in fact all they did was was turn up the screws and squeeze the little guy some more. My guess is if the books were opened we would see the somewhere north of 60% of that profit came from service fees not from investment.
Sorry for the rant but this story poked me in a sore spot
“… With no money, there can be no accumulation of wealth.”
And also no incentive to do any more work than the guy next to you. Also, no way to determine who gets what when dealing with scarce resources.
Sorry MuddyBoy, but banks make their money from lending out the money their depositors have in the bank. So if you are one of the “little guys” who don’t have any money of significance in the bank, you aren’t making them any money. That is why you pay a higher fee than somebody with a large account balance.
“And also no incentive to do any more work than the guy next to you.”
That’s just sad. Are you telling me you don’t do anything without payment?! The sole drive of your life is being compensated?! No hobbies, desires, or self satisfying goals, other than the accumulation of stuff?! God, you must be real fun at parties.
SN, the reason why our economy is as powerful as it is is because of the economic incentives for risk taking that exist. The lack of those incentives is precisely why the soviet system failed.
The real world is not like the communist utopia of the smurf villiage where people dutifully work for no personal gain.
“The real world is not like the communist utopia…”
I agree that capitalism gives incentive to do what you ordinarily wouldn’t want to do. E.g., no one would work on an assembly line or in a slaughter house without compensation.
But can’t you recognize that there is more than merely a capitalist incentive that drives us. Maybe and hopefully I’m just reading your original comment too narrowly.
No, I agree that there are things that motivate people beyond the tangible payment they receive for their work. But all other things being equal, Person A is not going to work harder than Person B if he knows he’s not going to get anything more for it.
A few years ago, when I owned my store, the bank started charging me a fee for depositing cash. It was something like $1 per $1000. That was on top of the per check fee and the debit card fee. And don’t get me started on the percentage of the transaction the credit card companies charged…
#13 But all other things being equal, Person A is not going to work harder than Person B if he knows he’s not going to get anything more for it.
So my neighbor isn’t going to work harder on his rose bushes then I will on mine? This guy’s passion is his garden. My roses are because they were here when I bought the house. But when I take a photograph of my flowers, I put much more into it then he ever will taking a picture of his. I have spent over an hour trying to set up a shot, only to walk away because it just wasn’t what I wanted.
BTW, we are both amateurs.
Your analysis in #11 is way short of the truth. America became the biggest guy on the block for several reasons, only one of which is Capitalism, or “risk taking”. It wasn’t the monopolies and oligopolies that built the country, it was the enforcement of a free market economy that encouraged the inventors. You confuse simple Capitalism with the oligopolies that the financial institutions have in this country and even much more so in Canada.
They not only control the money, but they want a piece of it every time you touch it. My paycheck is deposited directly into my account. The mortgage insists upon an electronic check, which costs me more then handing them cash. The utilities insist upon checks or electronic transfer, again which I have to pay for. I just deposited $80 in coins for my six yr old at her bank. They wanted $5 because they weren’t rolled.
How exactly does your, or your neighbor’s, personal hobbies have anything to do with what I was talking about? Answer.) Nothing.
But, if you take two people working in a factory, both of them earning equal pay and enjoyment from those jobs, one of them will not normally be willing to work harder than the other. Hell, most union jobs are structured as to dicourage people from working harder than others because it not only makes people look bad, but if I’m having to do more work than you that must mean that another person could be hired (and paying dues of course)…. they also can’t be viewed as supporting a meritocracy, can they?
Or back to this cashless society fantasy that I originally replied to. If everybody can just get from each other what they want for free (let’s not even bother with how this couldn’t work simply because of scarcity), what reason do I have to break my back to start up a new enterprise that may or may not succeed when I have nothing to gain from it? The possiblity of gain from risk is the very thing that inspires much of the invention and new small business creation. What exactly does the free market economy provide besides being the place where competition and risk taking takes place?
About your bank — if your bank is charging you for writing checks or to deposit coins into your account, maybe you should find another bank or credit union instead of complaining about it. That is, after all, how competition works.