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Banks Are Accused of Overcharging Nonprofits

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Banks Are Accused of Overcharging Nonprofits

Banks have recently come under fire for the fees they have been charging nonprofit organizations across the country. These include groups such as many different scout groups, after-school groups, and family services agencies. This has created a lot of outrage among the community.

The fees these banks charge can reach more than £7 a month for maintaining the account. In addition, fees for a single transaction can reach £1 or more.

One of the biggest problems is that most of these organizations have volunteer staff members. These workers are willing to give up their time without compensation but do not appreciate that they have been forced to pay significant fees to use these accounts.

Although many of these organizations have significant levels of capital, they cannot afford the same bank fees that organized for-profit institutions have. They bring in most of their money through donations from followers who are trying to support the philanthropic missions of the organizations. They are not able to stretch their money as far give the substantial fees the banks have imposed on them.

Another disadvantage these organizations face is their inability to earn substantial interest rates from the accounts they place their money into. Larger businesses can place their money in more dependable accounts which allows them to earn more reliable interest rates.

While these fees are fairly disappointing to charity members, they need to understand that they still have options. Some banks do not charge any transaction fees, such as the Norwich & Peterborough (N&P) BS Business Gold program. The only disadvantage with most of these divisions is that they have very few locations. Norwich and Peterborough don’t even have 50 divisions in all of the UK.

There are some other banks you can look into if you are going to be trying to create an account with a decent savings plan. For example, the Scottish Widows Charity Deposit Account pays about 1.5% on balances.

Nonprofit organizations should still try to exhaust all of their options before they start pursuing more established banks. Banks such as Santander and Barclays have several fees that they charge their customers. In addition, they do not always disclose what those fees are right off the bat, which can lead to several problems for them in long run.

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