| Checking accounts at community banks cost nearly half as much as those offered by national banks, while also offering interest rates that are nearly 10 times as high on average, according to a recent study from WalletHub.
Credit unions, on the other hand, are offering cheaper monthly fees on average than community, small, regional and national banks, and also offering the higher interest rates on interest bearing checking accounts than any other institution (.58 percent on $1,000 balance), according to the same study.
For this study, WalletHub analyzed the rates, fees and features associated with more than 2,200 deposit accounts including checking accounts, savings accounts, money market accounts and CDs from banks and credit unions across the country.
Overall, according to the study, financial institutions are having success at adding checking accounts when they reduce minimum-to-open requirements (down 14 percent year-over-year), reduce the monthly fee and increase interest rates.
The study states that people looking to save on checking account fees should focus on offers from credit unions, which are 39 percent cheaper than the next-best option, which is online checking accounts.
More than 60 percent of credit unions surveyed in the study have a zero-dollar minimum to open an account, far more than any other institution in the study.
However, according to data in the study, the minimum balance to avoid monthly fees at credit unions is $8,000 on average, higher than every other type of institution and more than $5,000 higher than community banks on average.
While not higher than credit unions, the study shows that community banks are offering better interest rates than small, regional and national banks with a .41 percent interest rate on a $1,000 balance.
Small, regional and national banks are offering no higher than a .08 percent return on the same balance, according to the study.
WalletHub created its own checking interest index, which combines the interest rates from a financial institutions on a $1,000, $3,000, $10,000, $25,000 and $50,000 checking account balance, and produces one average interest rate for each institution.
The index showed that credit unions offered a .53 percent return overall; community banks had .35 percent return; national banks had a .04 percent return and small and regional banks had a .07 percent return overall.
