One woman, Kristen, got miffed with banks and created Bank Transfer Day, November 5th 2011 which led to 600,000 people changing their bank to a credit union, 16% of business loans shifting to Mutuals/Credit Unions. Ariana Huffington has started MoveYourMoney and others are following suit. Any bets as to when the banks start fighting back a la Fox News and Media?
The Banking industry is dead in the same way as Media is dead. I don’t mean gone, I mean changing at a subterranean level, and when it implodes it will be with a whimper not a bang. Of course we will still have Media: the need for one part of the community to find out News from another part of the community remains with us. But it’s CHANGED. And of course we will still have banks: one part of the community still needs to transfer assets to another part of the community. But the way it’s done, and how, is irrevocably changed already. And fundamentally, under attack.
Bank Transfer Day.
Kristen Christian was sick of Bank of America. The Los Angeles art gallery owner had both personal and business accounts with the big bank, and had had enough of ridiculous fees and poor customer service. So Christian created an event on Facebook called “Bank Transfer Day” and invited 500 of her friends to close their accounts at big for-profit banks and move their money to credit unions on Nov. 5. The movement spread — quickly.
The Facebook page has over 8,000 “likes,” and over 35,000 people have RSVP’d “yes” to making the move. (Interest.com October 15th, 2011)
Ok, so “liking” something on Facebook is one thing but. BUT. Do people actually switch banks, on a whim? Cos their mates are? Cos they are grumpy with the incumbents?
While Bank Transfer Day, and the dump-your-bank sentiment that serves as its backdrop, has earned a lot of media coverage and promotional dollars among credit unions, are people really switching?
The folks whose job it is to facilitate that move behind the scenes, who manage the so-called “switch kits” of electronic banking, say it’s so.
Several big credit unions and the vendors who supply their technology told Credit Union Times last week they have seen a surge of new memberships that began when Bank of America declared its $5 a month debit fee in late September.
“We’ve more than doubled our usual rate of membership growth in the past 17 or 18 days,” said Howie Wu, vice president of virtual banking at the $9.5 billion, 700,000-member BECU in Tukwila, Wash.
“We usually average about 6,000 to 7,000 new members a month, but from the date of Bank of America’s announcement to today, we’ve totaled 10,400 new members,” Wu said Thursday.
A half a nation away, “We’re on track to open more accounts in one month than we ever have before,” said Mary O’Rourke, vice president of electronic services at the $4.4 billion, 357,000-member Randolph-Brooks FCU in Live Oak, Texas.
The Facebook page itself says:
Together we ensured that the world will always remember the 5th of November as the date American citizens stood in solidarity to advocate for local communities. In four weeks leading up to that date, 700,000 Americans shifted $4,580,000,000 in deposits alone from corporate-level for-profit banking institutions to not-for-profit credit unions that strive to promote economic growth in our communities. We sent a clear message that conscious consumers will support businesses that focus on people instead of profit.
We aren’t finished. Please take the opportunity to tell your family & friends about the benefits of doing business with a not-for-profit credit union. Don’t wait. Begin the process today. Every day is Bank Transfer Day! (see also NOTES on Facebook Page)
If you are not sure about Facebook Page statistics (now taken over by a credit union!) here are Reuters talking about Bank Transfer Day being accountable for 11% of bank moves:
More than 600,000 U.S. consumers have moved their money from big banks to community banks or credit unions, thanks to the much-publicized Bank Transfer Day last fall, according to an analysis released by Javelin Strategy & Research. (Jan 27, 2012)
and
Charlie Kroll … the founder and CEO of Andera Inc., a pioneer in online account opening who’s Providence, R.I., company now hosts the transfer activity, the heart of the switch kit, for more than 500 credit unions and banks.
“We saw a spike in volume the day Bank of America actually announced the fee, which is pretty predictable, but then it went up about 40% the next day and has stayed at that level ever since,” Kroll said.
“Open Banking” (like opensource) is on the rise:
Kilmer said his company is hosting those applications for online use by 106 clients and more in branches and that they’ve seen increases in recent days ranging from as little as 10% to as much as 40% “or even higher.”
“We’re seeing an average of 2.5 accounts in the average opening,” he said. “This is a relationship-building exercise.”
I also had a link for a 16% rise in small business loans at credit unions due to Bank Transfer Day- which I can’t find now. Blech. I can never find these statistics when I want them, so up they go on bloggy! Based on the presentation I gave in Cairns at the National Mutuals Conference in October 2011 to a thousand bankers in credit unions and mutuals. Interesting to see that the Facebook Page is now being run by a Credit Union, not Kristen! (Which was my main call to action, if I remember rightly…)
I’m not even mentioning peer to peer currencies, bitcoin, peer to peer forex, peer to peer loans. Just showing the ground being ploughed and tilled before it gets seeded with peer to peer plants. And I hate gardening! Well, I like it, it doesn’t like me, brown plants for days. What I guess I’m trying to say is that this revolution may or may not grow, but the soil is being prepared anyway…
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