Banks Making Big Bucks On Return Check Fees
Consumer Federation of America (CFA) is continuing to report that banks are making big bucks on return check fees.
Based on industry data provided to the American Bankers Association (ABA), banks collect billions of dollars annually from fees levied against consumers for bounced checks and incur relatively small expenses.
In fact, according to the CFA the average bank charge for return items is 84.4% more than the cost of handling returned items, and far more than a reasonable profit margin.
ISOs selling Check Guarantee services should remember that CrossCheck, Inc., one of the leading Check Guarantee Companies in the Payment Services Industry, is the only company that reimburses merchants for the return check fees, in addition to the check amount.
The above chart is reprinted with the permission of the Consumer Federation of America, Bounced Checks: Billion Dollar Profits , Graph Sources noted as: ABA, Retail Banking Report, 1993 & Bank Administration Institute, Check Processing Survey, 1992.
