May 19, 2020

Bank of America Considering New Checking Fees

Bank of America
Citibank
JPMorgan Chase
bank fees
Bizclik Editor
2 min
Bank of America Considering New Checking Fees

 

The current climate of low interest rates, slow economic growth and limits on service charges have been putting stress on the banking industry and big banks have been quietly making moves to increase their revenue.

Last fall, customers were able to influence Bank of America, JPMorgan Chase and Wells Fargo to back down from plans to impose $5 monthly debit card fees. But the Wall Street Journal reports that Bank of America is revising its stance and is now weighing the possibility of implementing a new wave of checking fees nationwide.

The plan is already in effect in Arizona, Georgia and Massachusetts, where Bank of America is testing a pilot program that charges $6 to $9 per month for a basic “Essentials” account. Other new account options carry monthly charges of $9, $12, $15 and $25 that can be avoided by “maintaining minimum balances, using a credit card or taking a mortgage with Bank of America.”

Bank of America spokeswoman Anne Pace told ABC News that the bank has been testing these banking options for over a year and is still considering whether or not they will be fully implemented.

“Our primary objective is to give our customer more reasons to do more business with us,” Pace said. “Whatever we decide will be done with that core principle in mind.”

JPMorgan Chase CEO Jamie Dimon said in a recent investor conference that it costs the bank about $300 a year to maintain the average bank account. 85 percent of customers of the country’s two largest banks (JPMorgan Chase and Bank of America) currently qualify for free checking.

As such, Bank of America is not the only institution testing or imposing fees. According to the Associated Press:

-          Since November, Wells Fargo has charged customers $15 a month for checking accounts unless the customer has three Wells Fargo accounts, maintains a balance of at least $7,500 or has a Wells Fargo mortgage.

-          Since December, Citibank has charged customers $20 a month unless they maintain a minimum balance of $15,000. The previous balance requirement was $6,000. Citibank also charges $2 for every non-Citi ATM transaction if the balance falls below the minimum.

Pace says that Bank of America customers have not been as outraged by the fees as one might assume.

“Customers see the value and associated feedback has been very positive,” Pace said. “So far, the solutions are working the way they were designed—more customers are taking advantage of the full breadth of products and services the bank offers to give them the financial control they seek.”

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Jun 8, 2021

Six issues at the top of tax and finance leaders’ agenda

Tax
Compliance
financeleaders
Deloitte
Kate Birch
4 min
As businesses accelerate their transformation journeys, tax leaders are under increasing pressure to add strategic value. Deloitte reveals six tax trends

New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.

According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.

And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.

Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.

Trend 1: Businesses seek more strategic counsel from tax

Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.

According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”

Trend 2: Tipping point for resourcing models

Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.

Trend 3: Digital tax administration is moving faster than expected

in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.

"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."

Trend 4: Data simplification and lower-cost resourcing are top priorities

Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.

At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”

Trend 5: Skillsets are shifting

Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.

Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact 

Trend 6: 2020 brought productivity improvements

Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.

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