Bankrate's fall '06 checking study: Fees rise again
By Greg McBride, CFA • Bankrate.com

Punitive fees continue to climb while the contrast between interest and noninterest checking accounts grows starker. Those are the main findings in the Fall 2006 Bankrate.com Checking Account Pricing Study.

Bankrate.com surveys one interest and one noninterest checking account at the largest banks and thrifts in each of 25 large U.S. markets. Bankrate.com gathers data on the fees, balance requirements and ATM charges pertaining to each of the accounts. A total of 248 institutions offering checking accounts were surveyed, with 247 interest accounts and 215 noninterest accounts evaluated.

There were a number of new milestones achieved, both record highs and record lows, in this edition of the checking survey.

Bankrate's fall 2006 checking study findings:

• Bounced-check fees hit a new high. • Average ATM surcharges set a record high. • Opening deposit requirements on interest, noninterest accounts: highest yet. • Balance requirements on interest accounts are at a new high. • Monthly fees on noninterest accounts are at a record low. • Fewer banks are charging their own customers for using another bank's ATM.

It is the punitive fees that are taking the biggest bites out of consumers' wallets.

Bounced-check fees
The average bounced-check fee, often referred to as a nonsufficient-funds fee, or NSF fee, by your financial institution, is now at a record high of $27.40. This is up from $27.04 in the spring edition of the survey. Bounced-check fees were on the move, even more than normal. There were 85 accounts posting increases in the bounced-check fee and just 32 decreases, compared to 39 increases and 19 decreases in the past survey. See bounced-check fee details.

ATM surcharges
ATM surcharges, the fee charged by ATM owners when you don't have an account with them, hit a record for the third consecutive survey. The average ATM surcharge is now $1.64, up from $1.60 and $1.54 in the spring 2006 and fall 2005 surveys, respectively. The trend toward higher surcharges is unmistakable: Since the last survey, 22 banks boosted these fees, six reduced them.

It's not only the increased amount of the fee, but the increased frequency with which consumers encounter the fee. Just how prevalent is the practice of ATM surcharges? Of banks owning ATMs, the percentage that assess surcharges is the highest on record -- 98.3 percent. To put that in context, the survey found the same percentage of banks, 98.3 percent, provide their account holders with online access to their accounts. So ATM surcharges are as commonplace as online account access during the Internet Age. See ATM details.

Let's move away from the fees that penalize consumers for a certain type of behavior and focus on the nuts and bolts of checking accounts.