Recent bank collapses have U.S. consumers worried about where they bank.
Peter Dziedzic knows what it’s like to stick with a bank. He’s shared the same Iowa credit union savings and checking account with his husband for well over a decade.
When Silicon Valley Bank descended into Federal Deposit Insurance Corporation control earlier this month, Dziedzic had less than a week to figure out payroll for his eight employees. What is it like changing bank accounts while running a business? It’s like opening a new credit card after an online hack or losing card, he explained. But there’s one big caveat: “It’s that, except times one hundred.”
But it takes a lot for people to switch bank accounts, experts said — and the FDIC guarantees of deposit insurance up to $250,000 are just one reason. “Because of convenience and inertia, most account holders are reluctant to move to another financial institution even if they know there are better deals available by doing so,” said Greg McBride, chief financial analyst at Bankrate.com.
“Many consumers focus mostly on checking accounts at their banks, and large national banks can be convenient to use for checking accounts,” Ken Tumin, founder of DepositAccounts.com, said in a statement. Similarly, Dziedzic’s husband already had accounts at Veridian Credit Union for years by the time they met. He too was not for turning. The fees were lower than Dziedzic’s account, so that was that. He stayed with his credit union.
One J.D. Power survey of bank customers shows the gap between dissatisfaction and action. Nearly eight in 10 people said they would stick with a bank when they felt it supported them in tough times, but around four in 10 said their banks were coming through on this.
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