3 Myths About Banking Locally, Debunked
April is Community Banking Month, where we take the opportunity to celebrate Arizona’s local banks and credit unions and encourage consumers and business owners to make the switch to bank locally! When your money is deposited in locally owned and operated community banks and credit unions, it’s quickly recycled back into our local economy. Currently only 4% of Arizona’s total deposits are in Arizona-owned banks and credit unions, which means that most of our money is controlled by global banks that don’t have a connection to our community.
When talking to people about the benefits of banking locally, we've realized that there are some misconceptions associated with local banking. There are three big myths that are associated with local banking that we want to address and debunk:
Myth 1: It is not convenient to bank locally.
One of the largest fears about switching to a local bank or credit union may be how you will access your money. With over 40 banks and credit unions that are based in Arizona all over the state there is likely a local branch in your neighborhood. Most community banks offer online banking portals to manage your money on the go. Phoenix-based credit unions Desert Schools Credit Union and Marisol Credit Union even have mobile apps for iOS and Android.
Most conveniently, many community banks have listened when members asked for no ATM surcharges. One quarter of small banks are no longer charging their regular checking account members to use outside ATMs. Others provide 2-4 outside ATM transactions monthly at no charge or reimburse surcharges monthly. This gives community bank members access to a large no-cost network of ATMs. Compared to national banks, only two large banks waive or reimburse ATM surcharges on basic checking accounts.
Myth 2: Local banks charge more fees.
Community bank members receive fee-free checking and savings accounts more often than members at large banks. According to a survey by U.S. PIRG released in November 2012, 63% of small banks offer free checking while completely free checking is only available at 24% of big banks.
Besides more commonly offering fee-free accounts to their members, community banks are more likely to offer commercial loans to small business owners than big banks. Small and mid-sized community banks control only 22% of all bank assets but account for 54% of small business lending. Additionally, average interest rates for loans are lower at credit unions because they are not-for-profit organizations that return net earnings to their members.
Myth 3: Moving from my current bank to a local bank is too difficult.
Making the switch to a local bank is as easy, if not easier than, getting set up at large bank. Before you start looking into your new bank first outline your needs: do you require online banking, direct deposit, and automatic payments? There are dozens of options in Arizona and once you know what you need our Community Banking Month webpage hosts a list of local banks and credit unions.
Community banks are known for their personalized service and high satisfaction scores so once you've narrowed down your choice we recommend scheduling an in-person appointment with a banker. Once you’ve made your decision, the rest of the process is straightforward. Contact the local bank or credit union that you want to switch to and they will guide you through the process to move your money easily.
If you want to learn more about local banking or want to make the switch please visit the Community Banking Month Homepage for resources and to sign the pledge to bank locally and keep your money in Arizona.