CHICAGO (9/18/09)--Business checking account fees rose this year, according to a new survey. Minimum balances required on the accounts more than doubled at large banks, while credit unions and community banks maintained the same levels as the year before.
The national median for business checking overdrafts was up $3--to $28 from last year, but the same for nonsufficient funds or returned checks and most other fees, according to Moebs Services, an economic research firm based in Lake Bluff, Ill. (Professional Services Close-Up Sept. 15). Wall Street banks with more than $500 billion in assets charged $35 per overdraft.
Of the more than 2,000 banks and credit unions surveyed by the firm, 94.3% of banks and 27.8% of credit unions offer business checking. Roughly 40.9% of financial institutions surveyed offer a "free" business account.
This is up from last year for all institutions, as large banks try to protect loss of business, especially small business, and community banks and credit unions try to get market share, Michael Moebs, CEO of the firm, told the publication.
For a business owner to avoid a checking account fee, large banks required a $2,250 minimum balance--nearly double the $1,250 required in 2008. Community banks and credit unions that require minimum balances kept the requirement level this year, with the banks requiring $1,000 minimum and credit unions $500.
"Main Street institutions definitely offer a better pricing deal than the big Wall Street banks," Moebs said. "In these hard economic times, businesses should seek the better deal."
Wall Street banks also increased their use of account analysis (a cash management review). This year, 92% of them offered accounting analysis while 66.3% of community banks and credit unions offer them.
Of the more than 27 million businesses in the nation, 10,000 are listed on Wall Street and the exchanges. Small business produces 65% of all U.S. jobs. Financial institutions charged businesses about $9 billion in service charges on deposits in 2008, said Moebs.
Courtesy of cuna.org