B of A says it will put a figurative bullet in the brain of its so-called "zombie accounts," to keep them dead for good. It will no longer accept electronic credits or debits to accounts that have recently been closed, producing charges and other problems for ignorant consumers.
No more zombie accounts around
All accounts that have been previously closed and are still sending electronic transactions for one reason or another at Bank of America will no longer be revived.
Consumers Union did a report in May where it said that banks should not do the practice, since it makes it much harder for customers to switch banks. This was when the term "zombie account" was termed.
According to Customers Union, B of A and Chase were the only two large banks who participated in reviving old accounts like this, and Bank of America has finally decided to quit the practice. Account holders have to pay unexpected maintenance charges and fines when a dead account is reopened without any notice.
Issue because of consumers
Betty Riess spoke on behalf of Bank of America when she said that the issue has more to do with consumers switching banks improperly than anything else.
"As always, we remind customers to allow time for outstanding items to clear the account, and make changes to automatic payments and credits before closing the account."
Last year, when B of A publicized it would be charging fees for debit transactions, many American consumers had had enough, prompting them to switch banks. According to a recent release from Consumer Reports, 20 percent of American customers thought about switch banks in the last year. However, 63 percent of them say they were daunted by problems such as how you can deal with the transfer of electronic payments.
A good start, claims Consumers Union
According to Consumers Union staff lawyer Suzanne Martindale, the step is good, but there is more out there:
"While this is a welcomed change in policy, consumers at Bank of America and other banks continue to face a myriad of obstacles that can make switching to a new financial institution a time-consuming mess. That's why we need Congress and the Consumer Financial Protection Bureau to enact reforms that make it easier for consumers to move their money."
There are a ton of different things the CFPB can do in order to make things easier on consumers when switching banks. This may include reducing check hold times, prohibiting unfair penalty charges and adopting portable account numbers to transfer between financial institutions. These are some of the policies that could be adopted to make things easier on customers.
No more zombie accounts around
All accounts that have been previously closed and are still sending electronic transactions for one reason or another at Bank of America will no longer be revived.
Consumers Union did a report in May where it said that banks should not do the practice, since it makes it much harder for customers to switch banks. This was when the term "zombie account" was termed.
According to Customers Union, B of A and Chase were the only two large banks who participated in reviving old accounts like this, and Bank of America has finally decided to quit the practice. Account holders have to pay unexpected maintenance charges and fines when a dead account is reopened without any notice.
Issue because of consumers
Betty Riess spoke on behalf of Bank of America when she said that the issue has more to do with consumers switching banks improperly than anything else.
"As always, we remind customers to allow time for outstanding items to clear the account, and make changes to automatic payments and credits before closing the account."
Last year, when B of A publicized it would be charging fees for debit transactions, many American consumers had had enough, prompting them to switch banks. According to a recent release from Consumer Reports, 20 percent of American customers thought about switch banks in the last year. However, 63 percent of them say they were daunted by problems such as how you can deal with the transfer of electronic payments.
A good start, claims Consumers Union
According to Consumers Union staff lawyer Suzanne Martindale, the step is good, but there is more out there:
"While this is a welcomed change in policy, consumers at Bank of America and other banks continue to face a myriad of obstacles that can make switching to a new financial institution a time-consuming mess. That's why we need Congress and the Consumer Financial Protection Bureau to enact reforms that make it easier for consumers to move their money."
There are a ton of different things the CFPB can do in order to make things easier on consumers when switching banks. This may include reducing check hold times, prohibiting unfair penalty charges and adopting portable account numbers to transfer between financial institutions. These are some of the policies that could be adopted to make things easier on customers.
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