Bank Fees - WTF Are They For?

[PowerPlayoffs06]

So my monthly fee just went up $2.00 apparently. Nice of the bank to just arbitrarily up the amount of money it costs me for allowing them to handle and make money off of my paycheques and investments.

Why the Hell do we have to pay bank fees? What do they pay for? Why does it cost 50 cents to do an online transaction to move money from my chequing account to my savings account? There was absolutely no work involved in moving that money. A mindless computer changed the values to two files in some random database.

Don't tell me it's supposed to fund maintainence for those computers or ATMs or some other bullcrap sob story. Banks rake in the dough. Imagine all the money they collect in fees alone every day from people just making simple transactions like withdrawals or transfers.

Why do I have to pay to access my own money? I'm doing the bank a favor by banking there. Not the other way around.

Banks =

[ken0042]

Originally Posted by PowerPlayoffs06

Why does it cost 50 cents to do an online transaction to move money from my chequing account to my savings account? There was absolutely no work involved in moving that money. A mindless computer changed the values to two files in some random database.

I'm pretty sure the computers weren't free, and the software didn't write itself.

Yeah, I think some bank fees are pretty high; like ATM fees which approach $4 for using another company's machine. I remember when Interac first came out it was 50¢ to use another machine, now its closer to $4.

But back to fees within your bank, I would rather pay what we pay and not have to worry; as opposed to what you find in the States where banks are so competative that some of them close up shop suddenly, making it very hard to get your money back out.

[ricosuave]

Agreed.

PC Financial FTW

[Phaneuf3]

so take your money out and hide it under your mattress. no fees whatsoever.

[DementedReality]

you pay a fee for service ... if you dont agree with the value provided, there are alternatives.

as a shareholder, the bank has an obligation to generate profits.

hands in my pockets, hands in my pockets

[ricosuave]

I honestly can't believe the 'pro-bank' comments thus far!

[Sample00]

Originally Posted by PowerPlayoffs06

So my monthly fee just went up $2.00 apparently. Nice of the bank to just arbitrarily up the amount of money it costs me for allowing them to handle and make money off of my paycheques and investments.

Banks cannot arbitrarily raise your service charges. By law, the must provide you with 90 days notice. Most banks give you more notice. I suspect you received something in the mail, email or it was posted at your bank's ATM.
Somewhere along the way you were advised that an increase was coming.
Secondly, they wouldnt just change one item either. It was probably a number of items. You may want to find out what those other service charge increases were and then shop around and see if there is a better deal out there.

[Phaneuf3]

Originally Posted by ricosuave

I honestly can't believe the 'pro-bank' comments thus far!

well, think about all the garbage you piss your money away on and banks offer pretty good value for their fees. sure it may seem like a ton but when you first think about it because you usually don't see things from the other side but, banks have a lot of overhead to cover.

also.... businesses try to make money

[DementedReality]

Originally Posted by ricosuave

I honestly can't believe the 'pro-bank' comments thus far!

who is pro bank? i am pro business. banks make money, lots of it .. whats wrong with that?

[fredr123]

Originally Posted by ricosuave

Agreed.

PC Financial FTW

We moved our accounts to PC Financial three years ago and have been really satisfied with the service thus far. No fees, you can use any CIBC bank machine to make your deposits and withdrawals (including the ones in the Macs stores) for free and you actually get a little bit of interest. Since they have no branches per se, I don't think you can get things like certified checks but for us that hasn't been much of a problem.

When we still had accounts with CIBC we would make a point to go inside and do all our transactions with a teller. It was a bit of a pain but it saved us the $1.50 or whatever it was per transaction fee at the ATM. It irritated the tellers too but I suppose that's what they get when one service is priced differently than another.

[Fuzzy McGillicuddy]

Originally Posted by PowerPlayoffs06

Why the Hell do we have to pay bank fees?

I have to start by saying I'm not anti-business and that profit is NOT a four-letter word in my vocabulary (like some corporate bashers). Banks are in business to make money. Businesses incur costs associated with providing these services.

Having said that, Canadian institutions like banking, insurance and telecom sectors are more profitable than those in other developed (western) nations. That's because Canadian companies typically charge more for service charges or other fees.

However, instead of bashing banks (or any other company) for trying to make money - why not allow more competition? If consumers had more choices then companies providing those services would be forced to provide more competitive pricing.

[PowerPlayoffs06]

I have a real, real hard time believing that banks need 50 cents per transaction in addition to all the interest they charge for credit, the money they make on their share of peoples investements and all other forms of income they have to cover overheads and pay for computers.

It's one thing to be out to make money, it's another to nickel and dime your customers for every little thing you provide them. If they add air fresheners to all the branches, I'm sure that'd be another service I have to pony up and pay for.

[Fuzzy McGillicuddy]

Originally Posted by PowerPlayoffs06

I have a real, real hard time believing that banks need 50 cents per transaction in addition to all the interest they charge for credit, the money they make on their share of peoples investements and all other forms of income they have to cover overheads and pay for computers.

It's one thing to be out to make money, it's another to nickel and dime your customers for every little thing you provide them. If they add air fresheners to all the branches, I'm sure that'd be another service I have to pony up and pay for.

This assumes that a business should charge less (or nothing) for one service it provides because it's making money from another. It would be like saying because energy companies are making massive profits from drilling and exploration, they should sell gasoline cheaply.

[Phaneuf3]

Originally Posted by PowerPlayoffs06

I have a real, real hard time believing that banks need 50 cents per transaction in addition to all the interest they charge for credit, the money they make on their share of peoples investements and all other forms of income they have to cover overheads and pay for computers.

It's one thing to be out to make money, it's another to nickel and dime your customers for every little thing you provide them. If they add air fresheners to all the branches, I'm sure that'd be another service I have to pony up and pay for.

... you win 10 internets!

they're providing you a way to access your money 24/7, securely, at your fingertips anywhere in the world that has a computer and an internet connection.... and you're complaining about 50 cents?

[Canada 02]

I think there are a number of common sense things consumers can do to save on transaction fees.

Rather than have say 20 debit transactions per month at $1.25/debit, use you credit card for all 20, then pay off the credit card in full with one debit. Using your credit card is an interest-free loan for one month - pay it off and it costs you nothing

Only use your banks ATM to avoid interac or Plus system fees

Maintain the minimum monthly balance - easier said than done for some people, but by doing so, many fees are waived - in general, it is a good practice anyhow - consider the amount to be an emergency fund, or a rainy day fund or whatever - I personally like having that little buffer.

[burn_baby_burn]

Originally Posted by fredr123

When we still had accounts with CIBC we would make a point to go inside and do all our transactions with a teller. It was a bit of a pain but it saved us the $1.50 or whatever it was per transaction fee at the ATM. It irritated the tellers too but I suppose that's what they get when one service is priced differently than another.

One would think that things are backwards. To have a computer do your banking should be free (or at least less expensive for the bank) than having a paid employee do the exact same thing.

[BCReefer]

Banks make a big profit every year. Royal Bank made a $4.7 Billion dollar profit in 2006 http://www.cbc.ca/money/story/2006/11/30/rbc.html only to see it tumpble in 2007 http://www.canada.com/montrealgazett...6-78f5e867d4f9 but they still made a profit. Most Canadian banks were hurt last year due to the banking issues in the USA.

If you have a mortgage with you bank, tell them you are not paying the monthly fee or you will move your mortgage, presto they drop it.

Banks do nickle and dime you and they tell us they do it so that they can protect our money yet how many people have had their pin numbers and cards copied? It happened to my wife and she had to get a new card. Lucky we did not lose any money but the fact is the banking industry said it is cheaper to pay out what people lost vs. fixing the problem.

When dealing with the banks you need to be as ruthless as they are, when shopping your mortgage ask for all the extras, money back, no fees and the best interest rate.

They will say no at first but when you come back that bank #2 will do it and your bank must match or your gone, they will usually match.

Lastly if you need to deal with a bank and you pay a per transaction fee then you need to look at one of their packages. I currently pay $12 for unlimited transactions (only cause I have my mortgage somewhere else).

[fredr123]

Originally Posted by burn_baby_burn

One would think that things are backwards. To have a computer do your banking should be free (or at least less expensive for the bank) than having a paid employee do the exact same thing.

You would think. I recall having a disagreement with a teller once who insisted it would be better for me to just do all my transactions at the in-branch ATM. I insisted I had time to spare and wanted to save the service fee. She was peeved but I didn't notice her give the same grief to the little blue-haired ladies in there to pay their utility bills and what have you.

We only did that after CIBC raised their minimum balance from $1,000. I was a student and my wife was only working part-time. It was hard to keep a minimum balance of any size when money was tight. If I could afford to have $10,000 sitting in a checking account I probably wouldn't care if they were charging me $1.50 per transaction or $15 a month. Those service fees really hurt when you're almost broke and live pay check to pay check.

There are alternatives out there. Banks will continue to charge as much as their customers will tolerate. If service fees really bug you, look elsewhere. Let your money do your talking.

[notoepik]

Good grief.

I live in Montana, I have no fear of my bank going under and suddenly closing because they don't charge me fees to do business there. Or for any other reason. I am pretty sure if my bank was to fold, it would not be because they missed out on the bucks they failed to charge to allow me to be their customer.

In fact they pay me a dime a time to use my debit card instead of writing a check. Silly bank.

[troutman]

Didn't CIBC just lose $1 billion?