PNC Bank is one of the last remaining big banks to offer no-strings-attached free checking.
Now the Pittsburgh-based institution has announced plans to join its peers and charge a monthly maintenance fee unless you hold a minimum balance in your account.
The bank, with more than 2,800 branches in 19 states and the District of Columbia, will stop offering free checking accounts as of Aug. 18. If you have Free or Classic Checking now, it will be changed to a Standard Checking account by June 14, 2014.
That gives you about a year to get used to the change — or switch to a cheaper bank or credit union.
Standard Checking comes with a $7 monthly service fee. You can avoid it if you keep $500 in the account, take in more than $500 a month in direct deposits or are 62 or older. You’ll also be charged $2 a month for paper statements if you don’t meet any of those qualifications.
The bank will introduce similar qualifications in December for its online-only account, Virtual Wallet.
Anytime a bank wipes out free checking, it’s bad news, particularly for poorer customers. But it’s not unusual.
A Pew Charitable Trusts checking account study last year found some 89% of checking accounts carried monthly fees nationally, the median monthly fee was $12, and it took an average minimum daily balance of $2,000 to have the fees waived, according to the study “Still Risky: Bank Fees and Disclosures in the States.”
A PNC spokesman told the Pittsburgh Post-Gazette the account changes would impact about 10% of the bank’s customers.
If you fall into that category, you still have free checking options. Plenty of community banks offer no-strings-attached accounts, as do credit unions and online-only banks.
Big banks have blamed government regulations that limit what kinds of fees and how much they can charge as to why they’re no longer offering free checking. New rules cut ATM fees by about half and limited how banks could collect overdraft fees.
Banks still earned $31.6 billion from overdraft fees in 2011, more than they made in 2010.
So talk with your money, and move it to someone who’s not going to charge you for the favor of holding your cash. PNC’s giving you more than a year to do it.