NEW YORK — Bank of America is rolling out a pilot program in three states that will offer its customers a menu of checking accounts with a variety of fee options.
The nation's largest bank, which does business with half the households in America, is testing in Georgia, Massachusetts and Arizona its plans to offer customers a choice of how they pay for their accounts. The test includes ways to avoid fees by linking multiple accounts, credit cards and even investment accounts with its Merrill Lynch unit. The three states represent about 10 percent of Bank of America's consumer business. The remaining states where the bank does business will likely be brought into the program next year.
The aim is to make fees clearer for customers, while encouraging them to bring more of their financial activity under the Bank of America umbrella.
"We are trying to provide you choices on how you compensate us," said Joe L. Price, president of the company's consumer and small business banking division.
The pilot program is the latest in a series of moves by big banks that signal the end of free checking accounts, a mainstay in consumer banking for the past two decades. Citigroup and JPMorgan Chase have also introduced account lists with various fees attached — and options for increasing banking activity or choosing less expensive ways to bank as a way to avoid those fees.
It's all part of the new landscape for banking, brought on by restrictions enacted in the past two years on overdraft fees, credit card charges and other lucrative revenue sources for banks.
"There are real costs with serving a customer with a checking account," said Bart Narter, a banking analyst with the consultant firm Celent. The expense of paying tellers or printing and mailing statements don't go away for a huge bank like Bank of America, he said, although some costs may be lower per customer than smaller banks.
By offering a lineup of products, Price said, the bank allows customers to choose how to compensate the bank for their services.
"We hear customers tell us they want more control," he said. "They want to pick their own destiny."
Bank of America said the monthly fees in the pilot will be $6, $9, $12, $15 and $25, depending on the type of account and level of service that comes with it. Bank representatives declined to be more specific about what fees are attached to each account, stating it is testing different fees in the three states.
There is a benefit for consumers in the ability to gauge which product is right for them, said Greg McBride, senior financial analyst with Bankrate.com.
"There's a way to avoid fees, and there's a few different roads to get from here to there," he said. "You either know the fee you're going to pay, or you know that there's an alternative to avoid it."