What Are The Real Numbers From Bank Transfer Day?

Did you walk away from your bank and join a credit union last year?

More time has gone by since Bank Transfer Day – November 5, 2011.  There were many estimates of the number that switched from big banks to credit unions and community banks.  Javelin Strategy and Research conducts consumer surveys on financial services products.   They pulled out information about Bank Transfer Day bank account closings from a December 2011 online survey of 5,878 consumers.

610,000 Switched in Q4 2011

According to Javelin Research, 610,000 moved their accounts from the big banks and switched to community banks or credit unions.  This represented 11 percent of the 5.6 million that moved their bank accounts during fourth quarter 2011.  Although, the number was only 11 percent, that still is a significant percentage. This was enough to make an impact on the banks to make a change and cancel the debit card fee.  Bank of America experienced an increase of 20 percent accounts closed in fourth quarter 2011 compared to fourth quarter 2010.

Of those 610,000 that moved accounts, approximately 26 percent moved their bank accounts because of the fees their bank charged.  Other reasons included customer service and moving their residence.

Having several accounts at the same bank can make it more difficult to switch.  Some stay with larger banks, because smaller banks and credit unions don’t offer some services such as online banking and mobile phone paying.

214,000 Switched to Credit Unions in October 2011

“Credit unions may enjoy the public’s ’love’ but they sorely lack the full tech expertise to appeal to a younger clientele which many banks, particularly large ones, retain,” declared James Van Dyke, founder of Javelin Strategy & Research in Pleasanton. Based on interviews with Occupy and Bank Transfer Day participants, Van Dyke said “these young faces are avid users of the kinds of social, mobile and online technologies that are in shortest supply at credit unions but proliferate at banks.”

In December 2011, Credit Union National Association, (CUNA), trade association for credit unions, revised their numbers of new members that opened accounts during October 2011. The original number was 650,000, but was actually 214,000.  The issue was due to confusion in the language in their credit unions survey in “new accounts” versus “new members.”  Approximately half of credit union members have checking accounts and the others have savings accounts or loans.  According to Credit Union National Association, 441,000 new members signed up in September and October, which as 75 percent increase over the entire year.

“Regardless of the impetus for credit union growth — either through new memberships, new checking accounts from existing members or a combination of both — it is clear that consumers made a significant movement to credit unions in the weeks leading up to ‘Bank Transfer Day,'” CUNA President Bill Cheney said in a statement.

Credit Expert Witness, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Credit Cards, Financial, Getting Credit, Improving Credit, Money & Identity, Saving Money

This post was written by John Ulzheimer