BOSTON–Massachusetts’ two state senators are asking the Bay State’s banks and credit unions to suspend fees for consumers until the coronavirus crisis passes.
Sen. Ed Markey (D-MA) and Sen. Elizabeth Warren (D-MA) have sent a letter to the CEOs of nine major banks and 10 credit unions in Massachusetts seeking a hold on everything from ATM fees to overdraft charges to minimum balance mandates, according to the Boston Globe.
“They probably won’t get that, at least not right away,” wrote Globe columnist Jon Chesto. “But many bankers were already thinking about the issues the senators raised. They’re fully aware of the pressures from the pandemic, without prodding from Washington, and they’re coming up with various ways to help as thousands of Massachusetts residents suddenly find themselves out of work.”
The Globe reported one group of local bank executives held a conference call with state and city leaders to compare notes, and talk about best practices during the pandemic to keep consumers and employees safe and provide financial help to troubled small businesses and individuals.
Take a Leadership Role
Markey told the Globe it’s incumbent upon the banks to take on a leadership role, as Massachusetts families are already “paying a terrible price” in lost wages, as business shut down amid the outbreak. Financial institutions, Markey told the Globe, shouldn’t be making money off their fees when some Americans don’t know if they’ll be able to make their next rent or mortgage payment. “These extraordinary times, he said, call for extraordinary measures,” the Globe reported.
Ron McLean, president of the Cooperative Credit Union Association, which serves CUs in Massachusetts, New Hampshire, Rhode Island and Delaware, said many credit unions are already helping members by waiving fees on late payments and overdrafts, and some have already established emergency loan funds to help those most affected by the pandemic.
‘A Dramatic Call, But…’
“Finding a bank willing to embrace the senators’ dramatic call for a broad waiver of fees will be tough, at least right now,” Chesto stated. “But the banks and credit unions are, for the most part, well capitalized after a decade-long economic boom. These institutions depend heavily on their customers’ financial health. Most bankers have a strong motivation for offering some leniency during a crisis. And for any who don't, Markey and Warren will be there to remind them.”
CU, Bank Trade Groups Issue Joint Statement
Meanwhile, the Cooperative Credit Union Association has joined with the Massachusetts Bankers Association in a joint effort to reinforce with consumers a message of safety, security and reliability of the financial services industry throughout Massachusetts as the coronavirus pandemic continues to spread.
“Massachusetts credit unions are ready and able to meet their member needs during this challenging time,” said Ronald McLean, CCUA president/CEO, in the statement. “We will do what we’ve always done, help consumers, families, businesses, and communities, no matter the situation.”
“Banks throughout the Commonwealth are prepared to serve consumers during this crisis while ensuring the health and safety of their employees and customers. We will work together to ensure that the financial needs of Massachusetts residents and businesses are met during these challenging times,” added Daniel J. Forte, MBA president and CEO.
Points Stressed
In announcing the partnership, the organizations stressed:
- Member institutions are well capitalized and financially strong. “Your deposits in banks and credit unions are safe and insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA). In many cases, the financial institution may have excess insurance for deposits exceeding federal deposit insurance limits of $250,000. The safest place for your funds right now is in your credit union or bank.”
- Credit unions and banks have initiated their business continuity plans to mitigate the impact of the pandemic on financial services throughout the state and to keep members, customers and employees safe. Consumers will continue to have access to their accounts, money, and services they need.
- Consumers are discouraged from making large cash withdrawals; the safest financial transactions are through online and mobile banking, credit and debit cards, electronic payments, and ATMs. “Many of today’s banking services can be conducted remotely on multiple devices, giving consumers access to their accounts at any time. While some financial institutions are utilizing drive-through services to “flatten the curve” and protect the health of both consumers and employees, staff is still available to serve customers.”
- Consumers and businesses are encouraged to contact their Massachusetts banks and credit unions to help get them through any financial hardship they may experience during this public health crisis. “If you or your business is being affected, we urge you to contact your financial institution as soon as possible. We are committed to working together with you.”
- Beware of fraud. “Financial scams always increase during uncertain times, especially for our seniors. Your bank or credit union will never ask for your account PIN, password or other personal information in an email. Be careful.”
- Government programs and assistance will be increasing in the days ahead. “The Commonwealth has initiated a $10 million small business recovery fund and a new Small Business Administration fund for $50 million. We expect to see additional innovative initiatives for consumers and small businesses in the days ahead.
- “While it’s easier said than done, remember we’ve been through difficult times as a nation before and seen them through. We have challenges ahead but be assured that your local bank or credit union is ready and willing to help.”