15 Reasons to Close a Bank Account

Here are the reasons which induce the people to close their bank account and switch to another bank. I have listed 15 major reasons which you should know.

Reasons to Close a Bank Account

1. The Customer Service is Not Good

Banks need customers and the customers need banks. It is a win-win situation for both parties. But it is also very important that the bank is offering good customer service and support. If the customers are facing any kind of difficulties with his or her bank account. Then the bank’s support team should help the customer. If the customer service of the bank is not up to the mark then customers like you and me will take the decision to close the account.

That is because being customers have a good amount of choices. No matter in which country you are. There are multiple banks operating. And there is a good amount of competition. When there is a good amount of competition then the ultimate winner is always the customer. And the Banking and Finance industry across the world is very competitive.

2. Your Bank is Not tech-savvy

Technology is everywhere and the banks have become so technologically advanced that we don’t feel like we should visit our bank’s nearest branch. Instead, we take our smartphone or the computer and access our bank account using those devices. When it comes to technology that the banks should offer to the customers. It does not stop at online banking and the debit card.

The limits have been taken way up. These days the banks offer mobile banking applications, debit cards with contactless payments, etc. Even the customer support can be provided by the banks using online chat support, email support, and also the support using the bank’s official social media handles. The customers need the bank to be tech-savvy. If not then the customer will make the decision to close down the bank account.

3. Branch Availability

If you have a bank account with say XYZ Bank for an example. Then there should be a branch of the bank near to your residence read. Say if something goes wrong with your bank account. And the issue can not be resolved online. In that case, you have to visit the bank branch with the required documents. If there is no branch in your area then you have to travel for a distance to avail of the branch services of the bank.

4. ATM Availability

Just like the branch of the bank, there should be also ATM availability in and around the places where you stay or often travel. If there are no good ATM availability at your bank. Then you will definitely face difficulties in using your debit card to withdraw money from your bank account. These days the ATM network is not a huge issue. But this is definitely one of the reasons why people make up their minds to close a bank account.

5. You want to Change or Switch Banks

You have been the customer of your current bank for a long period of time now. And now you are totally bored with its services, and your bank has nothing much innovative to offer. In such a case, you might have decided to change the bank. Maybe you have found a new bank which you feel is the right one for you. So before you change or switch between banks it is recommended to close your existing bank account.

6. You are Not Happy with the Bank Employees

In every business, the people who interact with the customers should treat the customers fairly and well. If not then it will result in unhappy customers. It is very rare that the customers visit the branch of the bank. But when they visit the branch the bank employees should make sure that the customers get their work done and step out to the branch happily. If the customers turn unhappy with the bank employees then it will harm the customer base of the bank.

7. Your Bank Does Not Value Long Term Customers

It is often said that it costs 3 times more to get new customers when it is compared to the cost of that to retain the existing customers. And this also stands true in the case of banks. When you are a customer of a bank for a long period of time now. It is quite obvious that you feel that your bank should value you more. It can be by providing you good offers and some vouchers occasionally. If not then this is one of the reasons to close a bank account.

8. Your Salary Account Has turned Into Savings Account

When you maintain a salary account with any of the banks you enjoy some perks. This is because you will be getting the money in your bank account from your employee as salary every month. So ultimately the money is coming into your bank. But when your salary account is turned into a savings bank account. You will lose those perks and the bank will start charging you more. In this kind of circumstance people just close down the account.

9. You Don’t Use the Bank Account Anymore

If you have any unused bank accounts then you should consider closing it down. There are so many reasons why you should not keep unused bank accounts active. The major reason is your account is prone to be used in wrong activities. This is the reason why the banks turn the accounts with no transactions into inoperative. If you have any account that you are not going to use anymore then you can reach out to the bank and get it closed.

10. It is Hard to Maintain Multiple Bank Accounts

It is really hard to maintain multiple bank accounts at once. You have to take care of the minimum balance of funds requirements. And at the same time, you also have to pay the account-keeping charges, debit card charges, etc. if your bank is charging you. It is recommended that you maintain a primary bank account and at the most one alternative bank account. But not more than that.

11. You are Moving to Another Place

When you are moving to another place where your bank is not providing the services or there no nearby branches. Then you can take the decision to close a bank account. Because as we have already discussed that if something goes wrong you have to visit the branch of the bank. And it will get really hard to travel way back just because there are no nearby branches.

12. The Savings Yield is Less

The interest you are getting on your savings is less when compared to the other banks in the competition. In such cases, it is very obvious that the customer will think of switching to the bank that is offering a higher interest rate. Or to the bank in which the savings yield is high. But while selecting the bank you should also take into consideration how safe the bank is.

13. The Charges are High

The if bank charges for account keeping, debit card usage, credit card usage, international usage are high. Then being a customer like me and you. We will think of closing down the bank account and switching to the bank whose charges are not so high. Here the bank charges on all the transactions done by the customers play a very important role. If the charges are high then it is a major reason for the customers to close the account.

14. Your Account Maybe Inoperative

When you don’t use your bank account for a long period of time. I am talking about 6 months to years of time. Then the bank will change your account’s status to inoperative. If this is the case then you will have to visit the branch of the bank to get your bank account active again. Many people just close down the account in this case, that is because they are not going to use the account anymore in the future.

15. Negative Balance

If there is a negative balance in your account then you just have thought to close it down. However, this one of the major reasons to close a bank account. But let me tell you that before the bank allows you to close down the bank account with a negative balance. You have to clear all the dues and pay off the negative balance. You can contact the customer care of your bank and ask the reason for the accumulation of the negative balance in your account.

Conclusion

These are the 15 major reasons to close a bank account. Sometimes I have even heard of people closing the account because they don’t like the bank account number. Well, that totally depends upon the choice of the customers. But before you close and switch to a new bank. Consider asking these questions to ask the bank before opening an account with them. This will help you to choose the right bank for your new account.

References Used:
  • https://www.financialexpress.com/money/idle-savings-accounts-4-reasons-why-you-must-close-them/1495121/
  • https://www.timesnownews.com/business-economy/personal-finance/article/want-to-close-bank-account-heres-what-all-you-will-be-required-to-do/509882
  • https://www.quora.com/What-reason-should-one-give-to-close-a-bank-account-with-zero-transactions-Will-there-be-fine

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