Consumer Reports blasts credit unions for overdraft income
California state report found credit unions make more than banks in fees
Consumer Reports, which frequently recommends credit unions over banks, appears to be having second thoughts, citing a California report that credit unions are charging higher overdraft fees than banks.
That’s not the only problem the consumer group and publication has with credit unions.
“Fee income is arguably part of a broader concern: That certain credit unions are exploiting their exemption from banking regulations while behaving more and more like banks,” Scott Medintz, a writer-editor at Consumer Reports, wrote recently in a report on the organization’s website. “For example, credit union membership has historically been restricted to a particular group—members of a certain profession, say—but now some credit unions let anyone join.”
He notes that, “Consumer Reports has frequently recommended credit unions because the earnings they generate are effectively returned to their customers in the form of higher savings and lower lending rates.”
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