Bank of America is launching a new eChecking account that has no minimum balance requirement. The twist is that in order to avoid the $8.95 monthly fee customers must enroll and receive eStatements versus paper and make deposits and withdrawals using ATMs versus a teller.
The development of an eChecking account is not new, but the Bank of America offering differs from forays into this area in the past because:
- It requires the elimination of paper statements. The major drawback of eStatment efforts of most financial service firms is that most do not require customers to give up paper statements — as a result just 40% of checking eStatment users receive their statement “online only.” Bank of America’s eChecking requires both receiving eStatements as well as requiring customers to give up paper statements — trees will certainly be happy to hear this news.
- It does not prevent customers if they have a legitimate question from speaking to someone. The mistake of eChecking efforts in the past is that banks charged customers if they needed to speak to a person regardless of reason. The problem with this approach is that customers who had a legitimate question (e. g. fraud on the account) were treated the same as a customer who had a mundane question (e. g. balance on an account). With Bank of America's new eChecking, low value transactions (withdrawals and deposits) are moved from the branch to the ATM, but customers can still speak to someone if they have a complex issue that needs to be addressed.
I applaud Bank of America on their innovate approach to the issue of lost revenue. It is easy to see future extensions of this account to include services (when available from Bank of America) like mobile deposit and even emailing ATM receipts versus getting a paper receipt at the ATM as Wells Fargo has done.