LOUISVILLE, Ky.--(BUSINESS WIRE)--According to a recently completed 12,000 response survey of a nationally representative sample, MemoryBank — an online-only banking platform available nationally — concluded that nearly two-thirds of consumers conduct their daily banking routines without much knowledge of their current account’s low earning rate, while more than a quarter were unaware of fees which diminish their account’s economic benefits before they’re realized.
“More than ever before, consumers need to be aware of the perks and pitfalls of their checking and savings accounts. With the ongoing transformation in banking, there are digital options available in the marketplace that boast higher interest rates and lower fees, while providing a top-of-the line customer experience for consumers that don’t require a high-touch, brick-and-mortar banking experience. That’s why we created MemoryBank,” said Andrew Varga, Chief Strategy & Innovation Officer at MemoryBank. With more than 48% of respondents with 2017 financial goals reporting a desire to save more money as their financial resolution, these survey results could not have come at a better time.
Most interest earning accounts don’t earn much.
Based on the survey results, most respondents reported not knowing that their checking and savings account earned very low interest rates or that they weren’t earning interest at all. In particular, the survey found that nearly 61% of millennial consumers sampled didn’t even know what their interest rate was or that they weren’t earning anything on their primary checking account. In addition, Generation X consumers were even less aware than their millennial counterparts, with 65% of those with checking accounts reporting a lack of knowledge of their current account’s low earning rate or earning no interest on their accounts.
What consumers also may not know is that the national average on interest-earning checking accounts is 0.04% APY^, and 0.06% APY^ for savings. By placing money in an account that earns little to no interest, consumers are missing out on substantial earning potential that could be saved by simply switching banks.
Thanks to the creation of online-only banks that pass along infrastructure savings directly to their customers, there are alternative banking options out there with more earning potential for those consumers that do not require a large brick-and-mortar footprint from their bank. MemoryBank, which offers an interest checking account called EarnMore^, gives qualifying customers the opportunity to earn up to 1.50% APY† on their deposits. That’s over 30 times^ more than the national average for interest checking accounts. When it comes to interest-bearing accounts, it pays to be a discerning and savvy consumer. If not, it could end up costing you.
Fees? What fees?
Another compelling finding of the Financial Fitness survey revealed many consumers did not know what they were being charged for ATM or monthly account maintenance fees. According to an analysis by SNL Financial and CNNMoney***, three of the big four banks earned more than $6 billion in ATM and overdraft fees alone in 2015, which breaks down to about $25 per U.S. adult.
Although many consumers largely go cashless, over 30% of survey respondents reported using an ATM 10 or more times in the last 12 months. According to a study by Bankrate*, consumers are hit with fees for using out-of-network ATMs —the average ATM fee is $4.57 every time a user withdrawals cash, costing consumers $45 per year or more. To help save consumers hard-earned money, MemoryBank provides access to over 85,000 surcharge-free ATMs**around the world, that’s more than the top five banks combined^^.
The survey also revealed more than 20% of respondents did not realize their bank charged a monthly maintenance fee just for using it. The same Bankrate study* also found the national average monthly maintenance fee for most banks is $15.17 for interest accounts and $5.78 for non-interest accounts — that’s up to $182.04 per year in monthly account maintenance fees the average consumer could be charged. MemoryBank does not charge maintenance fees.
It’s time to reevaluate your bank.
MemoryBank’s survey sheds much needed light on the metaphorical holes in the pockets of U.S. consumers. “We conducted this study to continue to help educate consumers in making better banking choices, as well as to continue to improve our own offerings,” said Varga. “The results showed us that consumers that may be willing to bank digitally are leaving a lot of money on the table by continuing to use accounts with low interest rates and higher fees. With the start of the New Year, now is the time to put your accounts under the microscope and demand more from your bank.”
Founded in 2016, MemoryBank is a new type of national branchless banking platform dedicated to providing digitally savvy, on-the-go customers with convenient “no hassle banking” and industry-leading interest rates. MemoryBank, which offers an interest checking account called EarnMore^, gives qualifying customers the opportunity to earn up to 1.50% APY† on their deposits. That’s over 30 times^ more than the national average for interest checking accounts. The MemoryBank brand name connects the literal idea of digital storage with the positive emotional memories collected over a lifetime. As a division of Republic Bank & Trust Company, it is a Member of FDIC with the highest possible A+ rating from the Better Business Bureau. Visit www.mymemorybank.com to learn more.
^The interest rate earned on deposits in an EarnMore Account will remain higher than the national interest rate for checking accounts defined as a simple average of rates paid by all insured U.S. depository institutions and branches for which data is available as reported by the FDIC on 12/27/16, if you meet minimum activity requirements as detailed on our website at http://www.mymemorybank.com/home/earnmore-account. As of 12/27/16 the interest rate earned on deposits in an EarnMore Account is over 30 times higher than the national interest rate for checking accounts defined as a simple average of rates paid by all insured U.S. depository institutions and branches for which data is available as reported by the FDIC
†Based on the current Annual Percentage Yield (APY) of 1.0% as of 12/27/16, plus a 0.50% bonus APY available to new EarnMore customers meeting minimum activity requirements as detailed on our website at http://www.mymemorybank.com/home/earnmore-account for the first 12 statements (bonus period), on balances from $0.01 – 249,999.99. Minimum $50.00 to open account. After the bonus period you must maintain activity requirements to earn the current APY and no bonus APY is available. Rates may change at any time. A new customer is defined as not having an EarnMore Account in the six months prior to date of account opening. This APY plus bonus APY is over 30 times higher than the national interest rate for checking accounts defined as a simple average of rates paid by all insured U.S. depository institutions and branches for which data is available as reported by the FDIC on 12/27/16. If activity requirements are not met or balances are in excess of $249,999.99, the APY is .05%. Fees may reduce earnings.
**Number of ATM locations subject to change. Look for the Allpoint, MoneyPass, SUM, or Presto logos at the machine.
^^Based on data compiled by Bankrate available at http://www.bankrate.com/finance/banking/banks-have-the-most-atms-1.aspx and http://www.bankrate.com/finance/banking/americas-biggest-banks-1.aspx
***Analysis by SNL Financial and CNN Money. http://money.cnn.com/2016/01/14/investing/atm-overdraft-fees/
*According to the 2016 Bankrate Checking Account Survey http://www.bankrate.com/finance/checking/2016-checking-account-survey-1.aspx