BRATTLEBORO—A Facebook campaign has designated Nov. 5 as “Bank Transfer Day,” where customers of big banks are being encouraged to close their accounts and move their money to credit unions.
And it seems to have already had an effect. Bank of America announced on Tuesday that it was backing down on a policy that would have charged customers $5 per month to use their debit cards.
Vermont is unique in that there are no Bank of America branches. The big banks that do business in the Brattleboro area — such as Citizens’ Bank, TD Bank, and Key Bank — aren’t on the radar of Occupy Wall Street protesters. What was the biggest bank in Vermont — Chittenden Bank — was merged with Connecticut-based People’s United Bank in 2008.
What Brattleboro does have is two credit unions and a savings and loan. Those institutions have not reported any unusual blip of activity over the past weeks, but all have seen significant growth in the wake of mergers and consolidations that have left only one independently-owned commercial bank — Merchants Bank — doing business in Windham County.
“Consumer sentiment against the big banks is running fairly high at this time and small community banks such ours, as well as credit unions, may be benefiting from this sentiment,” said Daniel Yates, president and CEO of Brattleboro Savings & Loan.
“We have experienced quite a growth spurt in deposits and members the past couple of years,” said Jeffrey Morse, president and CEO of River Valley Credit Union.
As a not-for-profit financial cooperative owned and governed by their members, credit unions have a different mission from that of for-profit banks, which are owned by private investors and governed by a paid board of directors chosen by stockholders. While credit unions usually allow members to vote on major decisions affecting the credit union, a bank’s board of directors is authorized to make decisions on behalf of stockholders without consulting with their customers.
“The past couple of months have not seen an unusually large increase in members or deposits, but steady healthy growth just as we have seen over the past two years,” Morse said. “I do expect this trend to continue as the larger banks continue to push their customers away with new fees.”
“We’ve had three or four people come in to switch their accounts over the last couple of weeks,” said Judy Wisell, CEO of Members 1st Credit Union.
“The nice thing is we don’t have to tell them to switch,” she said. “People are finding out on their own that there are alternatives for their money. It just takes a while for people to catch up.”
While the ire directed at the big banks is high right now, Yates cautioned that “it’s important for people to remember that while we have ‘big bank’ representation in Brattleboro, the people [who] staff those banks are our neighbors and friends. Many of them have been with those institutions since they too were more of a local bank, and they could be impacted by the fallout of such a movement.”
Those long-term relationships are keeping some people at the big banks, said Wisell.
“If people have a good relationship with the people at a certain branch, they are more likely to stay put,” she said.
It’s also difficult to switch, Wisell acknowledged, given that many people have direct deposit for their paychecks or Social Security, and have set up direct payments from savings or checking accounts for bills or other items.
“But we try to help where we can,” she said.
The local credit unions and Brattleboro Savings & Loan all charge fees for various services. The difference, said Wisell, is that they are more in line with what it costs to provide a service, and are not seen as profit centers, as is the case at many of the big banks.
“The bulk of our income comes from loans, not fees,” said Wisell. “If we get money coming in, we want to lend it out. Our main focus is helping our members.”
Shifting your money
The Bank Transfer Day movement originated with Kristen Christian, a 27-year-old Los Angeles art gallery owner.
She said she chose Nov. 5 because of its association with 17th century British folk hero Guy Fawkes, who tried to blow up the House of Lords but was captured on that date in 1605.
It is Fawkes’ face on the ubiquitous face masks that have been seen at anti-globalization protests in recent years.
In a recent interview with The Village Voice, Christian said that “It’s not people taking their money and burying it under their mattress. It’s shifting the money to a company people respect the practices of. It’s like, if you don’t like Wal-Mart’s practices, shopping at a local grocery store instead.”
A similar movement inspired by friends of Arianna Huffington called “Move Your Money” started in late 2009. It saw moderate success.
But the Occupy Wall Street protests and Bank of America’s debit card fee announcement inspired Christian to start her own version.
She created a Facebook page and said that while she welcomes the support from the Occupy movement, she does not specifically endorse any of its activities. She also lists a directory of credit unions in the United States and Canada on that page.
Christian is supporting credit unions because she believes that “banking with a truly local bank is better than a corporate-level bank, but credit unions will have more of a positive impact on the consumer and his/her local community.”