WASHINGTON – TD Bank has become the second major U.S. bank, along with Chase Bank, to announce it will voluntarily adopt Pew Health Group’s simple disclosure for checking accounts. Pew’s Safe Checking in the Electronic Age Project created the concise form to allow checking account terms and fees to be more transparent and easier for consumers to understand. The Pew Health Group is part of The Pew Charitable Trusts, a nonprofit organization to improve public policy and inform the public.
According to Pew’s research, the average length of disclosure documents at the nation’s 10 largest banks is 111 pages, making it difficult for consumers to find important policies and fee information. The new form facilitates comparison shopping, allowing customers to see what best fits their needs and making institutions compete on clear information.
Ryan Bailey, head of deposit products and pricing at TD Bank welcomed the abbreviated form. “At TD Bank we are constantly looking for new ways to make banking convenient for our customers,” he said. “We want our account holders to be able to see the common fees and features associated with their account.”
The movement to make checking account fees more transparent comes at a time when the federal Consumer Financial Protection Bureau is beginning a series of initiatives to bring greater clarity to how checking accounts work. The bureau was formed in July 2011 as a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act and is responsible for consumer protection.
Pew has suggested that improvements be made to the banking industry by requiring financial institutions to:
Provide information about checking account terms and fees to consumers in a concise format.
Provide account holders with clear, comprehensive pricing information for all overdraft options.
Make overdraft penalty fees reasonable and proportional to the bank’s costs.
Post deposits and withdrawals in a fully disclosed manner that does not maximize overdraft fees.
“We commend these financial institutions for providing their checking account holders key information in a consumer-friendly way,” said Susan Weinstock, director of Pew’s Safe Checking in the Electronic Age Project. “We encourage other banks and credit unions to adopt our simple disclosure form to shield consumers from unexpected fees that are often hidden in over 100 pages of disclosure documents.”