Open Letter to Ky Telco Credit Union

Ky TelcoI am writing to you to express my extreme dismay and utter disappointment in your organization that come about as of the recent letter I received from you.  Your letter indicates that effective March 1st my account that I have with you will begin to be charged a $5.00 monthly service fee.  The letter goes on to indicate that this is because of the cost of my account and specifically in regards to having maintained an average daily balance of less than $200.00.  My first reaction was you have got to be kidding me and my reaction since that time has went to m a much more negative place.

First and foremost, in regards to the minimum balance, I will remind you that your minimum balance on all deposit accounts used to be $25.00 (or was it $50.00, I forget) and I maintained that balance.  Your own choice to lower that to the $5.00 a few years back was phrased to me by the senior teller, “as a way to help folks out a bit during these tight economic times.”  Clearly, this is something that has been forgotten, as in your current letter it was plainly stated that accounts with low balances were costly to maintain.  Beyond that though, if it is truly a break even point when a deposit account has $200.00 instead of a $5.00 balance just simply raise the minimum balance to the $200.00 and charge accounts below that amount.

In fact, that brings me to my second major point of complaint.  Your letter said specifically that my average daily balance had been less than $200.00 for the past year and hence my option was to take a loan or credit card in order to avoid the $5.00 dollar monthly fee.  While those options are fine, I am not interested at this time in either of those two products.  A third option would have been to just maintain that $200.00 balance going forward.  However, there was no mention of that in the letter and instead my measure was going to be based on the past year when I had no prior indication that such would be held as standard.  I find this a little absurd as I am sure most account holders would.

One other fact in regards to that minimum average daily balance.  That letter arrived at the ver end of January or possibly the first of February.  During the month of January, my balance started at over $4000 and not drop to below $1000 until the middle of the month and was indeed well over $200 for the entire month.  That was indeed before the notice came out, but was probably past when selection of who the $5.00 fee would be applied too.  All the same though, it gives a sense of you really do not know your customers all that well.

Lastly, and this is the one point I do not get at all.  Have you paid attention to the news since around say late July as it relates to the banking industry?  While I know some fees have been limited by congressional acts, there is a clear indication that most banking institutions are flush with cash right now due to limited loaning out of funds.  While I realize you are not a bank, I do know the fee limits apply to you and would guess the later is also fairly applicable.  Beyond all of that though, look at what happened to Bank of America with its suggested $5.00 monthly service fee.  As a reminder, that proposed move lost thousands of accounts (number I believe close to 100,000 instead of just a few thousand).  Further, after lots of customer complaints and an online petition Bank of America (and other banks) backed down on the monthly service fees.

While I realize I am only one account holder and your number of accounts is much smaller than that of Bank of America, I am starting the movement against your institution myself right now.  I call it McAfeeing someone, as I will be taking my business elsewhere and not coming back.  I realize that $5.00 a month only adds up to $60.00 a year, but that is $60.00 that my family and I can sure use to our benefit much more so than the small value you provide to us, especially given the number of option available to us that are free of monthly service fees and/or make it clear in advance what the requirements are to avoid such.

As a follow up, here is a petition similar to the one that was big part of Bank of America reversed its plan to have a similar service fee, that you can sign if you are interested.

** -Image is Ky Telco Federal Credit Union Logo.

2 Replies to “Open Letter to Ky Telco Credit Union”

  1. There is actually nothing about a minimum of 5 transactions included in any literature that I recieved.  I regularly did well over 5 transations on a monthly basis. The letter indicated only the historical evidence of a balance under $200 as being the reason.  Also note, when I checked with the tellers at the local branch there was also no mention of 5 transractions, but only the $200 amount.   Please check your facts if you are member and recieved such a letter.  And for the record, no one said anything about anything being a suprise with the notice, it was suprise anyone in the banking (and especially credit union, that prides on being a value to customers) is actually going down the road of charging a monthly fee.  It is a moot point from my prespective though, I refuse to pay out even a measly $60 year for an account when there are other free accounts available with clear rules of how to operate to maintain it being service charge free without mixed messages.
     

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