South Asian Insider
Bank Of America's Poorest Customers To Be Charged For Checking
Just over a month after Republicans pushed through a sweeping corporate tax cut from which Bank of America stands to gain billions of dollars, the bank is set to start charging its poorest customers $12 a month for the privilege of having a checking account.
The charge, implemented earlier this month, applies to customers with an “eBanking” account, which was free for anyone who didn’t receive paper statements or use bank tellers. Bank of America has phased out eBanking and transferred those customers to “core checking accounts” that require them to contribute a direct deposit of at least $250 a month (that’s $3,000 a year) or keep a minimum daily balance of at least $1,500 to avoid the $12 monthly fee. Most national banks with a physical presence have similar requirements for free checking accounts, according to a comparison tool on Bankrate.com. Credit unions and online-only banks, however, often don’t have a monthly charge.
While $12 a month might seem manageable, that’s not the case if you can’t meet the new minimum qualifications for a free account in the first place, NPR’s Steve Inskeep notes:The timing of the bank’s decision, right on the heels of a massive Republican-backed corporate tax cut, drew outrage across the internet. A Change.org petition protesting the bank’s decision had more than 86,000 signatures by Wednesday afternoon.
Among U.S. banks, Bank of America is one of the largest beneficiaries of the corporate tax cut, according to an analysis the investment bank KBW shared with HuffPost. Analysts at KBW predict Bank of America’s earnings will increase 17.8 percent in 2018 once the tax cut is factored in, compared to an expected 13 percent earnings increase for banks overall. Assuming KBW’s estimates hold, that means the bank could pocket an additional $3.8 billion or so in 2018. (Bank of America turned a $21 billion profit in 2017.) Bank of America spokeswoman Betty Riess told HuffPost the termination of eBanking isn’t “new or recent,” despite what it seems. The bank stopped offering the account five years ago and has been slowly migrating customers into different accounts ever since, she said. Riess couldn’t say how many eBanking customers were affected by the final account closures this month. For fee-conscious customers who don’t meet Bank of America’s minimums, Riess noted the bank offers a “SafeBalance” checking account with a $4.95 monthly fee, but it doesn’t allow for overdrafts.Lack of access to traditional banking services forces marginalized people into the hands of even riskier financial institutions, like predatory lenders, which exacerbates poverty, says Lawyers’ Committee for Civil Rights Under Law, a nonprofit organization that fights inequality.
“Poor people who are denied access to traditional bank services are left vulnerable to costly check-cashing outlets, pawnshops and other predatory services,” said Kristen Clarke, the group’s president and executive director, in a statement. “By pushing poor people into the dark world of alternative financial services characterized by higher fees and exorbitant interest rates, low-income communities are at risk of being thrust into further economic distress.”
Clarke said the bank’s action would disproportionately affect African-American and Hispanic consumers, who have historically been excluded from banking services at higher rates.
US opens embassy in Jerusalem as clashes between Israel police and Palestinians leave 37 dead
The US on Monday opened its embassy in Jerusalem, a city at the epicenter of the Israel-Palestinian conflict, even as protests eru...
First Lady Melania Trump undergoes ‘successful’ procedure on kidney condition
First lady Melania Trump underwent a “successful” procedure Monday to treat a benign kidney condition and was expected to remain h...
From a rice mill clerk to south’s first BJP CM, a look back at Yeddyurappa’s political journey
From serving as secretary to the Rashtriya Swayamsevak Sangh (RSS) to becoming the first BJP chief minister in the south and later...
DU admissions 2018 commence today: Online application, courses offered, fees, exam date, expected cut-off
DU admission 2018: Delhi University (DU) will begin online registration to its undergraduate programmes on May 15, that is, tomorr...
J&K govt removes officer who issued order for Kashmiri Pandits visiting Kheer Bhawani temple
Days after Deputy Commissioner (Relief), Jammu, asked Kashmiri Pandits intending to visit temples in the Valley on Kheer Bhawani f...
Maharashtra govt to rope in private players for teleradiology
Facing a shortage of radiologists, the Maharashtra government plans to set up teleradiology centres in rural and tribal areas to d...
PNB-Modi chargesheet: Named in Nirav Modi case, Allahabad Bank CEO, two PNB directors face axe
The Central Bureau of Investigation (CBI) probing the alleged Rs 13,400-crore fraud involving diamantaires Nirav Modi and his uncl...
Vijay Mallya loses $1.55 billion assets case in UK court
Embattled liquor tycoon Vijay Mallya, undergoing an extradition trial in a UK court over fraud and money laundering charges by Ind...
Tourist death in J&K: Take relook at amnesty to stone pelters, JCCI president appeals to Centre
The death of a tourist from Chennai in attack by stone pelters in Kashmir evoked widespread criticism in Jammu, with ruling Bharat...
Google I/O 2018 keynote LIVE UPDATES: Google Assistant to get six new voices, new features
Google I/O 2018 opens today on May 8 with a live keynote address by Google CEO Sundar Pichai. The annual developer conference is t...
© All rights Reserved. The south Asian, Published Weekly from New york.