ricep5Premium
join:2000-08-07
Jacksonville, FL | First Chicago - Teller Fee I worked at First Chicago when the $3 teller fee was implemented. While control of the marketing was poor, there were very sound fiscal reasons why they did this.
There were many customers who wanted to take advantage of the low checking rates and access to the broad coverage of FNBC ATM's throughout Chicago. However, they didn't like our Money Market rates, so they would open a Schwab or Fidelity MMA and simply do a check teller deposit to the FNBC account when they needed cash.
This was very nice for the customer, but lousy for the bank. Anyone who knows banking knows that they make money on the overnights and when someone takes out as much as they put in and leave the balance at near zero all the time, it is a big money loser.
Why did we offer this kind of checking? Easy, our market in less affluent areas demanded it and we supplied it. Unfortunately, more affluent clients took advantage of the service. So the teller fee was developed to discourage people with near zero lifetime balances to use the ATM for routine deposits.
What didn't make it in the marketing was the fee was waived a majority of times to accomodate the circumstances. Like, broken ATM's, relationship of the customer, etc. Usually, anyone who had a payroll direct deposit had their fee waived if they used a teller.
While it got a bad rap for the bank, it worked. People who could afford it, began to increase their relationships. FNBC got more competitive rates and it actually increased our market share in underserved areas.
The people who complained the loudest were those who were getting the "free ride" of the checking/ATM service while milking their MMA's.
Today with electronic transfers common using the Net, teller charges are somewhat outdated. Economy checking services using an ATM provides 24 hour service with less hassle. |
