WASHINGTON—It’s the “Wild West” for consumers when it comes to checking account disclosure practices, according to one new analysis.
The same survey also suggests that traditional banks offer the most transparency regarding key account terms, more so than the credit unions included in the survey.
The report from WalletHub shows that online-only accounts trail all brick-and-mortar offerings.
Capital One was rated No. 1 for transparency, with Navy FCU—the highest-rated CU in the report—landing sixth.
Questions Asked
WalletHub evaluated pricing transparency within the checking account market through analysis of issuer websites. The company analyzed offers from the 30 largest banks and five largest credit unions that offer online checking account applications.
The analysis sought to answer the following questions:
- Visibility of major fees on product page: Are key checking account fees disclosed up front?
- Accessibility of Fee Information: Can the consumer easily find fee disclosures on the website?
- Clarity of fee information: Once an applicant finds fee information, how easy is it to digest?
Key findings:
- The average checking account has approximately 25 total fees. As was the case in previous WalletHub studies, the variance in disclosure policies made it hard to determine the precise number of fees associated with each checking account, but most institutions fall in the 20 - 40 range, with some reaching nearly 50 total fees, the company stated. “The sheer number of different fees associated with checking accounts prevents effective product comparison and decreases the likelihood that consumers will find the best checking accounts for their needs.”
- A general lack of uniformity continues to exist across institutions in terms of how disclosures are formatted, the language used to describe fees and the extent to which different fees are delineated,” WalletHub said. “This significantly inhibits consumer rate shopping efforts.”
- WalletHub’s Checking Account Transparency Report said it found that that FIs overall take in more than $30 billion in overdraft-fee revenue annually.
More on the original WalletHub study can be found here.