While there are plenty of reasons people might choose a credit union over a bank, one big reason typically has been that credit union fees are often lower. This has especially been true of overdraft fees, but a new study finds that’s not the case anymore.
According to financial services research firm Moebs $ervices, the median bank overdraft fee last year was $30, the same as it’s been since 2010. “From 2008 through the first part of 2015, credit unions maintained a statistical advantage with a lower [overdraft] price over banks,” Moebs said in its analysis. But by the end of the year, that had changed, with the median credit union overdraft fee rising to a very bank-like $29. It’s the first time since 2007 that credit unions haven’t had a statistical advantage over banks in their overdraft fees.
From 2005 through 2011, credit union overdraft fees didn’t budge, with a median of $25 for that entire time, while the bank median shot up from $25 to $30 between 2007 and 2010, then stabilized. The report includes plenty of smaller banks and credit unions that charge less than the median, although Moebs finds that only about 2% of them—roughly 250 institutions—today charge less than $20 for an overdraft.continue reading »