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Free Checking Still the Norm at Some Financial Institutions

Less than 60 percent of people who make less than $30,000 a year have a checking account, according to a Bankrate.com survey. (megawatts86/Flickr)
Less than 60 percent of people who make less than $30,000 a year have a checking account, according to a Bankrate.com survey. (megawatts86/Flickr)
February 13, 2018

BOISE, Idaho – While free checking may no longer be available at Bank of America and other big banks, some financial institutions still offer this service without charge.

Credit unions are touting their ability to provide free financial services to their members.

Angela Nelson, public relations manager for Mountain America Credit Union, with branches in Idaho and Utah, says credit unions are able to do this because they don't serve an invisible board of directors. They are not-for-profit and member-owned cooperatives.

"That's why so many credit unions are able to proudly offer free checking to their members," she says. "We just want to return value to them because they are the owners; they're the reason that we're in business."

ECONorthwest research found that Idaho credit unions saved members nearly $90 million through benefits such as lower loan and credit-card interest rates last year. It also said Idaho members saved more than a $100 a year on interest payments when financing a new car through credit unions.

People who make less than $30,000 dollars a year tend to pay three times as much in bank fees compared with other customers and less than 60 percent have a checking account, according to a Bankrate.com survey.

The website also found that 84 percent of credit unions don't charge for checking. But Nelson says big banks still dominate the narrative when it comes to financial services.

"We exist to save people money, and that, in turn, creates competition in the market," she explains. "It's hard because so many people don't realize that credit unions are out there or that they can join a credit union."

Still, credit unions are gaining in popularity. About 55 percent of Idahoans are members.

Eric Tegethoff, Public News Service - ID