I was heading to a wedding.
It was Saturday. A week or so ago. And I did what you usually do before arriving at the venue – I picked up some money to shove into the groom’s, Joey’s, breast pocket. (By the way, if you’re reading this, Samantha, I loved the endless cocktail hour.)
My debit card had just been reissued and I forgot my PIN. So I walked into the Valley National Bank branch on Route 36 in Atlantic Highlands, N.J. and asked for a withdrawal slip.
We don’t have those anymore, the teller said. (I’m going from memory, here)
What? Ok, here’s my driver’s license. Just give me my money.
You’ll need a check… That’ll be a dollar.
I paid up, in cash, with a loose single in my pocket, took out 120 bucks, and gave it to my buddy several hours later.
But more than a week later, I was still bothered.
I called the bank as a reporter for American Banker to inquire about the fee. Within thirty minutes, Marc Piro, Valley National’s vice president of marketing, called me back. He didn’t (read: couldn’t) say much.
The next day, he emailed me:
“Valley conducts comprehensive due diligence on the fee structure of all our products and services. These decisions are not made arbitrarily and many of the fees charged by Valley are very reasonable when compared to the fees charged by competing financial institutions.”
To a customer, that sounds like a kiss-off. It reads like, We just don’t care.
And I get it. Banking is a business. Tellers cost money.
But in an age where community banks — a category I think Valley National fits into (its holding company Valley National Bancorp has roughly $16 billion in assets) — pride themselves on their hometown feel, this is a marketing strategy that makes me think twice about who I bank with.
Now, am I going to close my account? Probably not. But will I trust Valley National with a personal loan or, eventually, even a mortgage? Absolutely not!
Most likely, I’ll continue to use third-party financial services – Paypal, Venmo and others – and turn my bank account into a dumb pipe. With that, they can’t even market rewards or offers to me.
If Valley National is going to spring charges on me like this, I just don’t want to trust my bank on something more important.
My beef isn’t really with my bank.
Valley National, by the way, has implemented a great two-factor authentication system for their online banking.
It’s really with a banking culture that is devaluing human interaction over ATM footprints. Or mobile banking over tellers. Or whatever nonsense they’re trying to sell me (cough: deposit automation).
This shouldn’t be an either-or philosophy. There is a right way to introduce fees. Simply put, add value. Don’t just start charging for stuff that used to be free.
My colleague, Jeanine Skowronski, recently wrote about how banks can best institute new fees while avoiding a customer backlash.
For instance, make the charge easily avoidable. ATM fees have escaped the level of scrutiny that overdraft or even monthly checking account charges inspire, despite the fact that they have risen steadily over the last few years. I’d argue this has something to do with a clear value exchange, since I’m the type of person who will pay for convenience, but it probably has more to do with the fact that these fees are easily avoided. Very few, if any, financial firms charge for using an ATM in their own network and customers who have a hard time staying in network could conceivably switch to a more accessible provider.
Knowing these options are available precludes someone from raging at the sight of the $6 ATM charge they incurred after using an out-of-network ATM at, for instance, their favorite casino.
It’s even more helpful if a firm is charging for something new.
For me, personally, if I wanted to feel like a number, I’d bank with Bank of America or JPMorgan Chase. I don’t, so I put my money in a credit union (they’re killing it) and Valley National.
I do so because I like that there’s a Valley National branch close to my father’s house. And I like that the same people have worked in that branch since my father opened his account before I was in grade school.
But if Valley National nickels and dimes me, they won’t keep me as a customer in the long run. I’d rather just put my money with Simple because at least I won’t have to get nickel-and-dimed at the branch.
The reason why: they don’t have branches.
Note: This blog post, originally for @AmerBanker, didn’t make it into print or online. I’ve decided to publish it here.