Today’s Globe has a great article about people moving their banking from the large banks (BOA…) to smaller banks and local credit unions.
I have been a big advocate of our local credit union for a few years and believe in this concept strongly. Why not be able to drive by the place where your money is everyday and see that the lights are still on? The biggest challenge for smaller banks and CUs is offering the services which the larger banks can provide on significantly smaller budgets. But, as I told them, MS Word has thousands fo features which the average person will never use and smaller banks should focus in on the “critical” services which the majority of customers need as well.
What’s needed? Besides being FDIC (or NCUA) insured… First, be somewhat competitive with products (CD rates, checking account fees, mortgages…). Second, provide on-line banking services which look like they were written post “Windows 3.0”. And third, provide a warmer, friendly, “people-based” face for the company.
Now I have a few mortgages, car loans… with my local CU even though their rates were not “the best” but I needed to “walk the walk”. I also have them for some of my banking but not everything since I have “remote” children which I like to have linked accounts with and the local CU does not currently offer this level of service.
BOA and others have recently announced the end of “free checking accounts” which I think is a great opportunity for local banks/CUs to grab some of those customers, tired of being nickeled and dimed to death. And remember (from WIKI)…
A credit union is a cooperative financial institution that is owned and controlled by its members and operated for the purpose of promoting thrift, providing credit at reasonable rates, and providing other financial services to its members.
So they are “non-profits” as well. My suggestion to BMGers (if you don’t already do this) is to consider using their local banks and CUs for their banking needs, as long as they provide the services you need and can be close on the rates you require.
christopher says
Steve Grossman campaigned on this for state funds while running for Treasurer.
johnd says
by designating the MA based banks and CUs to administer the Heat loans. These are 0% loans for home owners to improve the energy efficiencies of their homes through new windows, doors, boilers, air conditioning systems… which can be up to $15,000 and be repaid over 7 years at 0% interest.
<
p>Let the local banks do this exclusively.
bluefreak says
While there are some credit unions that are stagnating, there are just as many that are clearly of the innovating genre, introducing new products and services to make them not only comparable to large banks, but sometimes even preferable.
<
p>For example, one area where credit unions are getting savvy is around the concern of banking outside their home area. To overcome this, more and more are joining the Credit Union Service Centers network (branded as CU Swirl). Basically, any credit union that participates acts as a “remote branch” of any other credit union in the network. You can walk into a member credit union in California and make deposits, withdrawals, loan payments, etc. just as if you were at your home credit union here in Massachusetts. And all you need to show is a government picture ID and know the name of your home credit union (knowing your account number is helpful, but not absolutely required). Not all services are available at “foreign” credit unions, but common banking needs are met and your home credit union can probably work with you via mail or fax to handle less frequent needs that can’t be done through the network (like loan applications).
judy-meredith says
consistent with your idea which is a good one. From the front page of his website press release in part:
<
p>
roarkarchitect says
Middlesex Savings is one Eastern Bank is another.
<
p>They are owned by their depositors and they can’t be bought easily and swallowed by the big guys.
<
p>
somervilletom says
I ditched B of A several years ago. I tried Citizens, and found they were no different.
<
p>I landed at Wainwright and have never looked back.
<
p>Here’s what I like most about Wainwright:
<
p>1. NO hidden fees, bogus funds availability games, mysterious surcharges. NONE.
<
p>2. Truly personal service. The branch manager knows us by name, knows our patterns, and alerts us when anything unusual pops up — earlier, rather than later. A particular electronic invoice from one of our suppliers was inadvertently submitted twice — our bank manager called us to check on it before the bank paid it. Can you imagine B of A providing service like this?
<
p>3. Online banking that is good enough for our needs. No, it doesn’t have the full range of bells and whistles. It lets me see credits and debits hit our accounts, it lets me transfer funds among accounts instantly, it lets me current balances and funds availability. That’s all I need.
<
p>4. Retail stores that are staffed by friendly, knowledgeable, and available agents. I’ve never waited more than a minute or two in a teller line. I’ve never had to wait to meet with platform staff. This, in particular, stands in sharp contrast to the sullen, incompetent, and frequently rude staff of the B of A office in Coolidge Corner.
jasiu says
<
p>Does this institution or any of the others mentioned provide Quicken support (bill pay, on-line transaction reconciliation, etc.)? The vast majority of my interactions with my current bank are via Quicken (seriously), so I’m hesitant to change as it works very efficiently for me.
somervilletom says
The Wainwright Online Banking package supports the following export formats:
<
p>
<
p>I have not verified that these actually work, I’ve only confirmed that they are currently available as export formats for my accounts.
stomv says
Wainwright banks are amongst the greenest in the industry. They build their interiors to LEED standards AFAIK.
dhammer says
They were bought by Eastern Bank this past summer.
somervilletom says
We’ll have to see what the New Year brings.
<
p>I am hopeful that they will remain preferable to B of A and their ilk even after the acquisition.
kirth says
for using a credit union. I had an account with BayBank. After several banking engobblements, I was suddenly with BoA, which was not acceptable to me. My credit union cannot be bought by Megabank, Inc., nor do they spend their time inventing fees to extract every possible dime from me.
sabutai says
After the financial collapse of the last eighteen months, I’m not banking with any behemoth outfit — who knows where my data and obligations would end up.
<
p>Heck, I’m one more bailout away from investing my savings in the First National Bank of My Mattress.
kbusch says
They might foreclose on your mattress.
centralmassdad says
Lets establish the FMIC
kbusch says
The FMIC will have to keep a close on balance sheets.
kbusch says
close watch
centralmassdad says
sabutai says
I sleep with the boss.
somervilletom says
I understand that that bank has been the subject of a great many undercover investigations.
<
p>Be sure they give you a blanket guarantee.
howland-lew-natick says
They give a great value. They don’t nickel and dime customers with the big banks’ fees for service. I haven’t paid for a checking account in thirty years. They promote savings and don’t push service on you that you don’t need.
<
p>But, if a big bank becomes insolvent I would expect the credit unions and small banks to fall into the abyss with it as the small institutions need a large correspondent bank for money manipulation.
dhammer says
However, every local bank and credit union isn’t the same. Progressives should be very concerned about the community lending a bank engages in. That means checking their CRA rating, ensuring they do Mass Housing or Soft Second loans.
<
p>Far too often, we hear, “local, small business” and confuse that with responsible small, local business. Plenty of credit unions can’t afford to make loans to risky borrowers, that means they red line minority neighborhoods – hardly behavior we should support. Those that do, deserve support, however, you’d be surprised at how more open a Bank of America or Citizens Bank is to lending in traditionally African American neighborhoods, where the local bank hasn’t made a loan there in years…
<
p>
conseph says
Great Points. I try to do all my banking local through a combination of small local banks and a credit union. I have found one thing in common with all of them that is not true of the large bank with which I used to bank (Citizens), they actually know who you are when you go into a branch!
<
p>For anyone interested in reading an interesting proposal to reforming the banking sector I would recommend Laurence Kotlikoff’s Jimmy Stewart is Dead, Ending the World’s Ongoing Financial Plague with Limited Purpose Banking http://www.kotlikoff.net/ Prof Kotlikoff offers up a proposal to rework the banking system so that it focuses on the needs of the consumer/saving public and not the needs of Wall Street Bankers, Washington lobbyists and Corporate CEOs.
kbusch says
The financial sector is also supposed to channel investment where it’s needed. That’s a useful function. It’s what we expect Wall Street to do for us and you can’t have a competitive market economy without it. So we really don’t want to get rid of that sector of our economy.
<
p>As a card carrying liberal, I still think Wall Street has grown too big and too influential. For the amount of resource it absorbs, it hasn’t so much to show for it.
<
p>Now, would anyone like a mortgage-backed security?
conseph says
The premise is that you separate the “functions” of banking such as deposit gathering, check cashing, money movement, direct mortgage lending, etc. from the high risk strategies employed on Wall Street where the risks, rewards and losses are tied to the firms and their investors not to the American taxpayer which has become the result of government deregulation of banks and investment banking via the repeal of Glass Steagall in the 90’s.
<
p>Wall Street and the investments banks play an important role in the US economy we need them and they need us, but the true functions of banking have been absorbed by these behemoths providing an illogical return scenario where when they do well they win and when they do poorly, we lose. This is not sustainable as there is no incentive for them to limit risk.
<
p>I think separating the activities that would be in limited purpose banking from the Wall Street Banks would move us towards the separation of these activities which, in my opinion, is a better result for taxpayers and those who want to simply bank with a bank. We are seeing it to a small extent with the transition to credit unions and smaller local banks and this would take it further.