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American Riviera offers checking accounts with no overdraft fees KENNETH SONG/NEWS-PRESSLaurel Sykes, chief risk officer, and Joanne Funari, chief operating officer, stand in front of American Riviera Bank in downtown Santa Barbara. They explained the bank is helping its clients in various ways during a difficult economy.
American Riviera Bank in Santa Barbara County is working to help customers during a difficult economy, with services ranging from checking accounts with no overdraft fees to Small Business Administration loans.
The bank recently announced its Simply Checking Account for families and individuals who otherwise would be unable to maintain one.
Simply Checking is officially certified by the National Cities for Financial Empowerment Fund (CFE Fund) as meeting the Bank On National Account Standards. ARB is now one of only 200 financial institutions across the country that offers Bank On certified accounts.
“It doesn’t target any specific income bracket. It is intended for people that don’t have the funds to maintain an account,” Laurel Sykes, chief risk officer for American Riviera Bank, told the News-Press.
“People that don’t have a traditional account such as a working family making $20,000 a year are likely paying up to $600 on check cashing fees alone,” she said.
“California law caps check cashing fees at 3%. A lot of larger institutions charge fees as high as $8-$10. Incentives in banking are to increase the unbanked, and the number of unbanked has dropped to 4 and a half percent.”
Ms. Sykes defined two terms — “unbanked” and “underbanked.” “Unbanked” refers to no services. “Underbanked” means that an account is held but services are not being leveraged or there are high prices with low balances.
“We wanted to broaden the reach in the community with 5% of the country unbanked and 15% of single mother households unbanked,” Joanne Funari, chief operating officer, told the News-Press. “Of those unbanked, 21% cite the reason being they do not have enough money to meet the minimum balance requirements.”
American Riviera Bank’s Simply Checking Account has no overdraft fees.
“We are not penalizing clients for making mistakes,” Ms. Funaria said.
“The trend (of unbanked customers) has fallen, but it is still too high in my book,” said Ms. Sykes. “You tend to see it in different geographies depending on the demographics. Some are afraid of being charged fees or do not understand how accounts work.”
But she noted some progress is being made. “Government payments coming through during COVID have contributed to 1.2 million more households banked in 2021 than 2019.”
Key features of Simply Checking include a monthly service fee of only $5, no overdraft or non-sufficient fund fees, the ability to pay bills and make purchases, and federal deposit insurance. There are also a variety of ways to avoid the $5 monthly service charge, such as setting up direct deposit or making 10 debit card transactions a month. Current customers can also link accounts to take advantage of the combined balance option.
Simply Checking is available in every one of American Riviera Bank’s five branches in Santa Barbara and San Luis Obispo counties.
“We wanted to make it easy for people. We also waive fees for 65 and older or 25 and younger,” said Ms. Sykes.
The News-Press asked Ms. Sykes and Ms. Funari if there are any risks on either the bank or the customer side, especially with speculation of a looming recession. “I don’t see a whole lot of risk for any of this. Maybe for larger institutions, there is a risk,” said Ms. Sykes.
“It is available to a broader audience; it is available to everyone,” said Ms. Funari. “I don’t see any risks for the client or the bank. It is an added product that will help people, and that is what we do. We are a community bank,”
The News-Press asked Ms. Sykes and Ms. Funari about other ways they support their customers.
“I think in general we have multiple ways to support people in the bank, business owners or first-time home buyers,” said Ms. Sykes. “If a bank is a member of Federal Home Loan Bank, they are eligible to sponsor grant programs,”
Ms. Funari noted, “ARB has been the No. 1 market share leader in San Luis Obispo (SLO) and Santa Barbara counties for four years and is a preferred lender for Small Business Administration (SBA) 7(a) loans. SBA allows for up to $5 million in financing and waives fees for loans up to $500,000.
“SBA loans are great for small businesses,” she said. “Small businesses were hard hit during COVID, and hospitality was hit hard. There is a long-term loan for hospitality with smaller monthly payments helping to manage cash flow. We want to get the money out there to help small businesses grow.
“In SLO, Santa Barbara, and Ventura counties and in California as a whole, 95% of businesses have annual sales of less than a million dollars. The state is made up of primarily small businesses. Sometimes these are undercapitalized and in need of support,” said Ms. Funari.
She said her bank’s mortgage department can leverage brokers or originate portfolio loans, which prove helpful to customers.
“Through a federal home loan bank, we can support low- to moderate-ncome borrowers for a downpayment through the WISH Program.”
“We can offer more besides just a checking account,” Ms. Sykes said. “One more thing is the last thing you want is a rent check returned. Overdraft protection transfer can set up transfers from a savings account. It’s important to go into a bank educated about all of the options. I think that one of the other things that is imperative is that everybody knows how it all works and educational and financial awareness is imperative.”
email: kzehnder@newspress.com
FYI
For more about Simply Checking at American Riviera Bank, go to
arb.bank/bankon.
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