News Summary Blog 1

http://www.20minutos.es/noticia/1778465/0/comisiones/bancos/evitar/


1.  Spanish banks are increasing their bank fees.  These fees include charging a customer for a credit or debit card and charging when making money transfers.  The Association of Users of Banks and Insurance has stated that customers will likely be paying around 567.8 euros per year.  In total there has been a rise of 3.6% in fees from 2011 to 2012.  The total amount spent on bank fees in 2012 14,600 million euros. The article goes on to say the cost of individual services that some banks will offer like, annual maintenance for accounts will cost about 178.8 euros and savings account boxes costing 150 euros.  The article wraps up with advice to customers on how to avoid banking fees.

2.  This article relates to the supply and demand graphs discussed in class.  As a bank raises their prices consumers will be less likely to put their money into that bank inorder to avoid fees.  In return this will eventually cause the demand for that bank to go down because consumers will either invest in another bank or possibly restrict their use of banks all together.  Even though the banks are required to inform their customers about a potential fee, the customer might still be cautious of what they are going to be charged for.

3. This increase in fees has occurred because spanish banks are trying to compensate for profit margins by increasing their bank fees.  The economic crises that Spain is experiencing has led to a fall in revenue for banks.  This increase is aimed as a way to adapt to the circumstances that the economy crises has brought.