It turns out the answer may not be “no one.”
Banks are still struggling to replace fee revenue, and customers have reacted negatively to new fees on existing products. Just look at what happened when Bank of America tried adding a $5 debit card fee.
The only major product that has increased fees has been checking accounts, and most banks now charge $7-$10 per month or more. However, many customers are exempt from these fees because they have a direct deposit set up or they maintain a certain minimum balance. Banks continue to raise requirements for free checking. According to the Huffington Post, SunTrust recently raised the minimum required balance from $500 to $1,500. But a large percentage of customers still qualify for free checking, and checking account fees alone will not be enough to plug the revenue gap.
So if banks cannot add fees to existing products and cannot raise enough revenue from checking account fees, then what will they do? APT has seen an increasing trend to add completely new products and services that carry fees. The theory is that customers are more willing to pay for new services than for those they are accustomed to receiving for free. For example, a recent BAI article highlighted how customers are willing to pay for certain “lifestyle” financial services, with identity theft alerts at the top of the list with “82 % of respondents … willing to pay an average monthly fee of $4.07.”
Customers can then decide for themselves if they value the service enough to pay for it. Banks are starting to offer services like identity protection, identity theft insurance, monthly credit reports, and 24/7 credit report monitoring. BBVA Compass offers a product that combines these services for $5.99 / month or $12.99 / month depending on the level of protection and coverage.
The only way to increase fee revenue without losing customers and causing a backlash is for banks to innovate and find new ways to drive value for customers. Retailers have been doing this for a long time. The best retailers are constantly testing new products and completely new product lines. The winning banks will be those who constantly test new ideas to find what new products and services customers value and how much they are willing to pay for them. Customers will pay more fees in the future, but the upside is that they will receive new serves that positively impact their financial lives.
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