The Big Story Blog

Happy Bank Transfer Day?

Posted at 2:34 PM on November 4, 2011 by Paul Tosto
Filed under: Banking, Economy

Bank Transfer Day is tomorrow. We don't know exactly what will happen. But the grass-roots effort to get the public to move their money out of big banks has caught a little bit of fire, fanned by the credit unions who stand to benefit the most.

The basic idea is simple: If you don't like the fees charged by the country's biggest banks, take your money elsewhere and, if enough people do it, banks will change their policies.

Bank Transfer Day has gone out of its way to say that it is not affiliated with the Occupy Wall Street movement and that it doesn't endorse their activities. It appears to be a genuine grass-roots effort started by a woman in Los Angeles who asked 500 people to join in. Moving through social media, tens of thousands of people have at least expressed support.

What happens after Saturday? Some writers are arguing it's only the start of a big bank backlash

Economists, though, realize that the banks are not sweating it.

Interestingly, some big bank representatives are using Bank Transfer Day to argue that credit unions have an unfair competitive advantage.

"This just illustrates the point that many tax-exempt credit unions have evolved into direct competitors with taxpaying banks and should have their preferential tax treatment revoked," American Bankers Association vice president Keith Leggett wrote today.

It's a tough argument to make since the biggest banks dominate market share in the U.S. Banks control 90 percent of the deposits in Minnesota and two banks -- Wells Fargo and U.S. Bank -- collectively hold more than half the state's bank deposits.

About Paul Tosto

Paul Tosto

Paul Tosto writes the Big Story Blog for MPR News. He joined the newsroom in 2008 after more than 20 years reporting on education, politics and the economy for news wires and newspapers across the country.

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