November 5th is "Bank Transfer Day," a hopping Facebook campaign urging Americans to move their money out of big national banks and into local banks or credit unions.
Day Inspired by Bank Of America Fee
Kristen Christian, a 27-year-old Los Angeles art gallery owner, organized the effort after Bank of America (BofA) issued a new $5 monthly fee to debit card users that would be implemented in early 2012. The fee targets those who have less than $20,000 in Bank of America accounts. The "Bank Transfer Day" movement cites this as a direct attack on the impoverished and working class. BofA is also a notorious foreclosure mill, doing little or nothing to help their clients facing foreclosure. The Bank Transfer Day Facebook page has 35,000 likes and support for the movement is growing by the second.
Bank Of America Caves
The new fee was BofA's petulant response to the 2010 Dodd-Frank Wall Street Reform bill. This bill allows the Federal Reserve to regulate debit card interchange fees of banks with over $10 million in assets and limits debit card interchange fees to a maximum of 21¢ per transaction. The new rule will help small businesses and consumers who were frequently hit with multiple fees related to one card swipe.
In a victory for on-line activism, BofA called off its $5 debit card debacle after a petition to end the fee gathered 300,000 signatures and 21,000 people pledged to close their BofA checking accounts. But the $5 fee is not the only thing inspiring movements like "Bank Transfer Day." "Occupy Wall Street" protests are spreading across the land and more Americans are taking notice. Eighty-two percent of Americans know about the occupations, 49 percent support them and big bank activism is becoming all the rage. Credit unions are experiencing a boom in new clients, up five-fold according to Reuters.
Guy Fawkes Day
Christian chose November 5th in homage to the British folk hero Guy Fawkes, who attempted to blow up British Parliament on November 5, 1605. The image of Guy Fawkes, as popularized by the 2006 graphic-novel-turned-movie, V for Vendetta, has been used in "Occupy" protests across the world. Christian's website says that, "While the Bank Transfer Day movement acknowledges the enthusiasm from Occupy Wall Street,..." it is a distinct effort.
Move Your Money Tools
The effort will not end on November 5th. Many different groups and organizations have taken up the challenge. For instance, The New Bottom Line coalition of housing and faith-based organizations started its own "Move Our Money" campaign. They launched on Monday and already an astounding $5 million has been withdrawn from BofA and other Wall Street banks such as JPMorgan Chase and Wells Fargo. Their goal is to move $1 billion by the end of the year. Amounts moved are reported and tracked at "Move Our Money USA."
These recent efforts are modeled on Huffington Post's "Move Your Money" project, which has been around for a number of years. The "Move Your Money" page has valuable tools to help consumer to choose a new bank or a new credit union including seven easy steps.
Since no one wants to move their money to a bank that's on the verge of collapse, the website asked some experts at HelloWallet and Institutional Risk Analytics to help them identify sound financial institutions. You can find these tools here. You will need to do further research if you want to screen banks for low fees, good service or ethical conduct. Make sure you ask your new bank in detail about any hidden checking account or credit card fees. Check the interest rate on the credit cards; the bells and whistles (i.e., cash back and airline benefits) are not as important as the interest rate. Some credit unions have interest rates as low as 9 percent; don't forget to check late fees and penalties.
So be sure to remember the 5th of November, but it is probably a good idea to leave the mask at home.
CMD's Emily Osbourne contributed to this article.