Credit Unions Compete with Rewards Checking Accounts

Lower fees are a big reason smaller institutions are selected over the behemoths. Many continue to offer no-fee checking accounts, provide access to surcharge-free ATM networks, and have lower overdraft fees and fewer fees overall. But lower fees don’t tell the whole story.

By Rob Rubin, Managing Director, Novarica

When comparing checking accounts between big and small banks, many bank shoppers on FindABetterBank choose small institutions because of no-fee checking and lower fees overall. However, “Rewards” checking accounts stand-out as a strong performer for small institutions by offering free checking, high interest rates and other desirable features like ATM fee rebates.

During Q2 2013, 137 banks and credit unions were listed on FindABetterBank continuously throughout the entire quarter. Fifty of these institutions have fewer than 100 branches, and at least one was present in 40% of all the search results generated by consumers in Q2 2013. Large institutions — banks with 1,000 or more branches — were present in 90% of all shoppers’ search results.

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