FOR IMMEDIATE RELEASE
May 4, 2021
Sharon Goldtzvik, 202.500.6362
Ginna Green, 510.866.5989
Dumping Bad-Actor Big Banks? New Report Shows How
A new report shows how American individuals and municipalities can move money away from bad-actor big banks, which are increasingly losing trust and support among Americans because of policies that undermine communities, damage the environment, and harm poor folks and people of color. While the idea of breaking up with big banks has become increasingly popular, the practicalities of doing so can seem prohibitive. The report, Breaking Up with Bad Banks: How Wall Street makes it hard to leave them — and how we say goodbye, from leading policy experts at the Action Center on Race and the Economy (ACRE) and Americans for Financial Reform Education Fund (AFR) shows how individuals and cities can make the switch.
The report, which can be found here:
- Details how banks make it needlessly complicated to switch;
- Provides step-by-step instructions for individuals and cities to make the switch;
- Explores alternatives to big banks like postal and public banks;
- Outlines social responsibility factors to consider when choosing a bank; and
- Recommends policy changes to facilitate consumers’ and local governments’ abilities to move money to institutions that do not violate the public interest.
“Big banks would love us to think that we’re stuck with them, even when they act in ways that harm our communities, like funneling our hard-earned money to finance private prisons or the fossil fuel industry,” said Renata Pumarol, chief of staff at ACRE. “Families of color shouldn’t be targeted for abusive, high-cost loans from companies bankrolled by the big banks. We’ve already called on municipalities to cancel Wall Street — we should all break up with big banks and implement solutions that serve our communities and the common good.”
The report details the immediate steps individuals can take to move their money out of big banks. It also includes a list of alternatives to big banks, including credit unions, community development credit unions, socially responsible banks and credit unions, Black-owned and Black-led banks, fossil-free institutions, and community banks.
The report also recommends a range of specific policy changes at the congressional, federal agency, and municipal levels to make it easier for consumers to change banks. These include recommended statutory and regulatory changes, establishing bank account portability, creating public banks owned by cities, and exploring postal banking. There are also a range of steps banks could take now to make switching accounts easier, and the report notes that some smaller banks and credit unions are taking these steps. “Banks can agree to share the necessary information with a consumer’s new bank, such as the account numbers and payment addresses for a customer’s bill pay program. Banks can do that now, without being required by the government to do so, but they won’t,” the report notes.
“Our financial system can and should serve the public interest,” said Linda Jun, senior policy counsel at Americans for Financial Reform Education fund. “Congress and federal agencies should enact policy changes that ensure we can choose banking institutions that reflect our values. All Americans should have access to innovative solutions like postal banking and public banks owned by cities, that have been proven to work in some states and in many countries globally.”
The Action Center on Race and the Economy (ACRE) is a campaign hub for organizations working at the intersection of racial justice and Wall Street accountability. WE provide research and communications infrastructure and strategic support for organizations working on campaigns to win structural change by directly taking on the financial elite that are responsible for pillaging communities of color, devastating working-class communities, and harming our environment. We partner with local organizations from across the United States that are working on racial, economic, environmental, and educational justice campaigns and help them connect the dots between their issues and Wall Street so that each of the local efforts feeds into a broad national movement to hold the financial sector accountable.
Americans for Financial Reform (AFR) Education Fund is a nonpartisan and nonprofit coalition of more than 200 civil rights, community-based, consumer, labor, small business, investor, faith-based, civic groups, and individual experts. and community groups. Formed in the wake of the 2008 crisis, we are fighting for a fair and just financial system that contributes to shared prosperity for all families and communities.