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EDITOR’S COMMENT: People are voting with their feet. The fact is that Credit Unions and Community Banks provide all the services that the average customer needs at a lower cost than the Mega banks. If this leads to decentralizing the power of the Mega Banks, it will change the landscape of finance and politics.
BOA and other large banks use their dominance in ATM services to attract customers. For twenty years I have labored to awaken the small bankers to the fact that the infrastructure already exists for the compete on the same playing field with the same services at lower cost to the customer and higher profit for the small financial institution.
We’ve seen the result of allowing the giants to grow and exercise their power over the marketplace and lawmaking and enforcement of laws. The latest revelations show that the small banks and credit unions were a far safer place to be than any of the banks “playing” in the securitization markets. Now that people are awakened to this risk, they have the opportunity to do something about it with their money and hopefully with their vote.
Local customers switching to credit unions for better service
See Entire Article in Yakima Herald Republic
BY MAI HOANG
YAKIMA HERALD-REPUBLIC
YAKIMA, Wash. — After 14 years banking with Bank of America, Carol Pimental was ready for an alternative.
She didn’t like the five-day holds on her financial aid checks, having fees to keep a savings account or to receive printed bank statements, or the confusing changes that required hours of reading bank documentation.
She switched to Solarity Credit Union in Yakima three months ago.
Pimental was familiar with credit unions — her parents have banked with one for years — but her frustrations put her over the edge.
“I got tired of dealing with it,” said Pimental, a 41-year-old Yakima resident who is studying accounting at Yakima Valley Community College.
While the concept of credit unions — nonprofit, membership-driven financial institutions — dates back decades, the industry may look back at 2011 as the year that consumers nationwide took notice.
“Our efforts in raising awareness in credit unions have been extensive but only when consumers decide they want to look,” said David Bennett, a spokesman for the Northwest Credit Union Association (NCUA), a trade group of 168 credit unions in Washington and Oregon.
Indeed, many larger banks drew more ire from consumers in 2011 with an increasing number of fees for its products and services.
In September, several banks announced plans to charge a $5 monthly fee for debit cards. Most banks ultimately dropped such plans, but not before drawing a backlash from consumers.
Meanwhile, consumers and other groups, such as the Occupy movements nationwide, pushed consumers to leave big banks. In November, Kristen Christian, a Los Angeles business owner, organized Bank Transfer Day to encourage consumers to pull their money out of large banks and into credit unions and other locally owned financial institutions.
In Washington state, credit unions reported a collective gain of 1,430 new members, according to the NCUA.
According to the latest data, Washington saw a year-over-year gain of 121,339 members in 2010. Data for 2011 is not yet available, but Bennett expects that credit unions will easily surpass those numbers.
These days, it’s not unusual for Solarity Credit Union to get new members disgruntled by big banks.
But by no means is it a huge influx, said president and CEO Mina Worthington.
“We did receive some increases in select markets,” she said.
While consumers are fed up with the fees and service issues of larger banks, that doesn’t always result in action.
“It’s so complicated to switch that people just generally don’t move,” she said.
Still the positive attention gives credit unions leverage, whether it’s in gaining new customers or persuading legislators to not pass burdensome legislation, she said.
HAPO Community Credit Union has seen year-to-year increases of 10 percent to 20 percent in both deposits and loans in 2011, said Scott Mitchell, vice president of lending and chief lending officer for HAPO.
But the movement toward credit unions in the Yakima Valley may not be as obvious as other areas because many consumers already bank with credit unions or other locally owned financial institutions, he said.
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