Update: Over 4 billion dollars was transfered from Wall Street banks to Main Street credit unions in the past week.
November 5th:
Guy Fawkes day. Google it.
One manifestation of this noosphere that we’ve all begun, whether or not we realize it, to surrender to, is that when we hear about a sensible, responsible action to take, we do it. Move your money from big banks to community banks and credit unions is one such idea. I remember Arianna Huffington talking about this in 2009. This fall, once Occupy hit the street running, the idea went out through the human microphone and since September 29, 650,000 of us moved our money in one month, more than the 600,000 in all of 2010. Whew! There’s lots of articles on this action in the cloud today, and lots of people have sent me links. Here’s an article that indicates how much this idea, though seeming to spring from one facebook page, arose as a synchronous mass.
Hate your bank? ‘Bank Transfer Day’ is Saturday
Grassroots groups urge people to move their money out of big banks
November 4, 2011
Reuters/Mike Blake
San Diego labor leader Lorena Gonzalez holds her life savings after closing her Wells Fargo Bank account and moving it to a local credit union as part of a protest against big banks in San Diego, Calif., on Nov. 2.
CHICAGO (MarketWatch) — If you’ve been thinking about firing your bank, now might be the time. A handful of grassroots groups are mobilizing people to abandon mega-banks for what one organizer calls “more friendly” smaller banks and credit unions.
Show time is Saturday, Nov. 5, dubbed “Bank Transfer Day” by its organizer, Kristen Christian, an art-gallery owner in California who started a Facebook movement after a handful of banks, most notably Bank of America BAC -0.31% , attempted to slap fees on debit-card use. Her movement has garnered support from consumer-advocacy groups and pressured big banks to kill debit-card fee plans. Read more: Banks retreat on fees but they won’t surrender.
“People are sufficiently outraged by how they’ve been treated by big banks,” said Adam Levin, chairman of Credit.com. “There had to be an equivalent of a national movement to get people more aware of local banks, community banks and credit unions.”
Corporate deposits squeeze banks
Many companies are placing big sums of money into federally insured checking accounts. This puts banks in a bind — and many are pushing back.
Christian is using Facebook to invite people to shift their funds from for-profit banking institutions to not-for-profit credit unions by Nov. 5.
“Together we can [insure] that these banking institutions will always remember the 5th of November,” Christian wrote on the Bank Transfer Day wall.
As of Thursday, nearly 36,000 Facebook users “like” the concept while more than 73,000 indicated they will be “attending” Christian’s “party.”
Meanwhile, an estimated 650,000 consumers have joined credit unions nationwide since Sept. 29, according to a statement on Thursday from the Credit Union National Association or CUNA, a credit-union advocacy group. That’s the day Bank of America announced its debit-card fee.
Credit unions saw savings-account deposits grow by $4.5 billion in that time, “likely from the new members and existing members shifting their funds,” CUNA said.
The Bank Transfer Day idea has caught the attention of progressive activist group MoveOn and some segments of the Occupy Wall Street movement, some of whom are calling for a Move Your Money “day of action” this Saturday. That’s a reference to the Move Your Money Project, started by Huffington Post co-founder Arianna Huffington in 2009. See the Move Your Money site. See Huffington’s Dec. 2009 column about the Move Your Money project.
Anonymous, the hacker group, is in on the action, too, by supporting a bank transfer among its followers.
Bank Transfer Day has prompted other groups, too, such as College Bank Transfer Day in which college students and recent graduates are urging students and universities to move their money by Nov. 5 from what they call “large, irresponsible banks” that they blame for a “wide range of economic problems” into local financial institutions.
The New Bottom Line, a coalition of community organizations, congregations, labor unions and others, has partnered with a group called The Other 98% to encourage cities and other institutions to also turn to local and community banks and credit unions in a Move Our Money divestment campaign.
Good news for small banks, credit unions
Credit unions and small banks, both bricks-and-mortar and online, have been taking advantage of the consumer outcry with a number of promotions. EverBank Direct, an online full-service bank that has branches only in its home state of Florida, is offering $60 to new customers. It also carries what it calls a “yield pledge” that promises to keep the interest rate on checking accounts in the top 5% of competitive rates.
“It’s definitely to highlight the different value proposition,” said Frank Trotter, president of EverBank. “We think of it as the ‘our-bags-fly-free’ approach to banking.”
The movement appears to be helping some banks and credit unions. BECU, which claims to be the largest credit union in Washington, said it’s tallied some 16,000 new members in October, a 200% hike from the average month.
PerkStreet Financial, a financial institution that parks your money in an FDIC-insured bank, saw its new checking accounts swell some 100% Sept. 30, the day after Bank of America announced it would charge the $5 monthly fee on debit cards, and then another 100% over that increase on Oct. 1.
Even if you miss the Nov. 5 deadline, credit unions and small banks will continue to keep the movement alive by reaching out to bank-averse customers for some time.
It’s not difficult to fire your bank. But think hard before you do. Do the math on what you might save versus what inconveniences you might endure and compare the alternatives when making a final choice. Read more: High fees? Here’s how to fire your bank.
Jennifer Waters is a MarketWatch reporter, based in Chicago.
