Thirty-six of the 50 largest U.S. banks have improved their policies for disclosing checking account terms and fees, overdraft practices, and dispute-resolution policies to consumers, but still have room for improvement in these areas, according to a new study from The Pew Charitable Trusts, a Washington, D.C.-based nonprofit.
The study, "Checks and balances: Measuring checking accounts' safety and transparency," rated the banks' policies, looking for "best" and "good" practices in three categories.
• Giving consumers clear and concise disclosures about costs and terms of checking accounts.
• Reducing the incidence of overdrafts and eliminating practices that maximize overdraft fees.
• Offering consumers a meaningful choice to resolve disputes with the bank instead of including a mandatory binding arbitration clause in checking account agreements.
The cheapest checking account offered to all customers at each bank was chosen for analysis.
The study found no bank achieved a "best" or "good" rating of its practices in all three of the categories. Instead, banks had gaps in their procedures that Pew said could put consumers at financial risk or expose them to high, unexpected costs for little benefit.
About 97 percent of the banks achieved at least one "best" practice.
In addition, 14 of the top 50 banks weren't included in the study because researchers couldn't find some important checking account terms and fees online or by mail, which meant consumers also couldn't review all the relevant bank disclosures for a checking account without visiting a bank branch.
The data for the study were collected in October and November 2012, and some banks may have changed their policies since then.
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