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Bank Switchers, Branch Locations And ‘The Five-Mile Rule’

Tuesday, August 13, 2013 - 6:53 AM
More than half of consumers shopping for a new bank only want to compare institutions that fall within 5 miles of their location. But there’s a big difference between urban and rural shoppers.

Today, most consumers prefer to do research online when they’re shopping for a new checking account or banking relationship. The internet enables people to cast a wide net and investigate all options available to them. FindABetterBank (a Novarica website) attracts consumers who use search engines precisely for this task. The comparison tool on FindABetterBank lets shoppers control how wide a net to cast by defining the radius of their search.

Bank Switchers, Branch Locations and ‘The Five-Mile Rule’
6
ShorebreakShorebreak2,615 posts since
Apr 6, 2010
Rep Points: 14,182
1. Tuesday, August 13, 2013 - 8:54 AM
Five miles??  Why bother??  My radius is at least 50 miles north, south, east and west of my locality and even further if the rate is good enough.  Unfortuntely, I can't find good rates unless I want to "really" go further!
2
paoli2paoli21,372 posts since
Aug 10, 2011
Rep Points: 6,011
2. Tuesday, August 13, 2013 - 9:19 AM
Re: paoli2 @ 1. Tuesday, August 13, 2013 - 8:54 AM
"Five miles??  Why bother??"

From the article:
"In a very densely populated part of the country, branch locations are likely the most important criteria when switching banks. But people who live in more rural communities are most likely to cast a wider net. People who live “in the middle of nowhere” are accustomed to driving long distances for everything — from buying milk and going to the post office to banking — and therefore are less sensitive to branch proximity."
5
ShorebreakShorebreak2,615 posts since
Apr 6, 2010
Rep Points: 14,182
3. Tuesday, August 13, 2013 - 9:32 AM
Re:  SB:   I have news for you and the article, this isn't always true nowadays.  I live in a "big" city yet it seems all the banks have taken an oath to stick together and keep rates low.  Maybe it is true that it is due to what is going on in the economy and the FED but there is no place to run or hide when it comes to finding decent rates unless one lives in an area with a Reward Checking for 3%.  They don't even have those in my banks and I am not going to do the checking thing in a bank not in my city.  Sooooo  just have to  make do with what I can find until sanity returns to our banking system and we can see some pitiful better rates before too long.
2
paoli2paoli21,372 posts since
Aug 10, 2011
Rep Points: 6,011
4. Tuesday, August 13, 2013 - 11:19 AM
Re: paoli2 @ 3. Tuesday, August 13, 2013 - 9:32 AM

Most working people that don't have a lot of time on their hands look for convenience when it comes to having a checking, and possibly a savings account, they can easily access. This applies to online and in-person. Local banks and credit unions offer those products and loans. Often customers ask friends or family where they bank at and then go to the same institution.  I utilize a local bank, within a ten minute drive, for my main checking account and have my safe deposit box at that location also. I don't keep a high balance in the account but have my pay direct deposited there and then my bills are automatically paid from the account. Therefore, in this case, convenience trumps receiving a higher rate of interest.
2
ShorebreakShorebreak2,615 posts since
Apr 6, 2010
Rep Points: 14,182
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