In the Know

Big Banks Make Big Profits On the Backs of Small Business Owners

January 18, 2023

1 minute min read

espite big banks running myriad marketing campaigns to say how much they care about small businesses, the truth is that they charge small business owners millions of dollars in fees while barely mentioning them in their earnings reports.

To better understand how big banks treat their small business customers, Novo analyzed the Q4 2022 earnings calls from JP Morgan Chase, Bank of America, and Wells Fargo. Here were some of the takeaways:

Big banks made hundreds of millions of dollars in fees for consumers and small businesses: Big banks continued to make extraordinary amounts of money off service fees. JP Morgan Chase reported $834 million in service fees over the last quarter, Bank of America $586 million, and Wells Fargo $696 million.
Small businesses are barely mentioned in earnings calls and reports: Many of the big banks' earnings calls and reports made little mention of small businesses. For example, on JP Morgan Chase's earnings call, small businesses were only mentioned three times.
Small businesses aren’t distinguished from "consumer banking" customers: Consumers and small businesses have very different banking needs. But during big banks' earnings calls, small businesses aren't broken out into their own category. Instead, they are simply viewed as another consumer segment.
The three largest banks in the US made a combined $2.11 billion in Q4 2022. Here’s a breakdown of how much they charge in monthly fees:

Chase Business Complete Banking	$15 or $0 monthly fee	Waive the Monthly Service Fee if you achieve $2,000 of minimum daily balance, deposits from Chase QuickAccept℠, or Chase Ink Business Card purchases
Chase Performance Business Checking	$30 or $0 monthly fee	Waive the Monthly Service Fee if you maintain a $35,000 combined average beginning day balance
Chase Platinum Business Checking	$95 or $0 monthly fee	Waive the Monthly Service Fee if you maintain a $100,000 combined average beginning day balance
Bank of America Business Advantage Fundamentals Banking	$16 or $0 monthly fee	Avoid the monthly fee by Maintaining a $5,000 combined average monthly balance or spending at least $250 in new net qualified debit card purchases
Bank of America Business Advantage Relationship Banking	$29.95 or $0 monthly fee	Avoid the monthly fee by maintaining a $15,000 combined average monthly balance
Wells Fargo Initiate Business Checking	$10 monthly fee	Avoid the monthly service fee with one of the following each fee period: $500 minimum daily balance or $1,000 average ledger balance
Wells Fargo Navigate Business Checking	$25 monthly fee	Avoid the monthly service fee with one of the following each fee period: $10,000 minimum daily balance or $15,000 average combined business deposit balances.
Wells Fargo Optimize Business Checking	$75 monthly fee	Includes up to 5 linked Optimize Business Checking accounts. Earnings allowance can be used to reduce the cost of eligible banking services.

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^Sources:

^{Wells Fargo}

^{Bank of America}

^Chase

^{Information accurate as of January 17, 2023}

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At Novo, we're built for small businesses. Novo customers do not pay service fees, and all of our reporting and metrics for success are geared toward small businesses' needs. That's why we were named the Best Banking App of 2022 in the Tearsheet Challenger Awards and one of Forbes' Next Billion Dollar Companies.

Learn more about how Novo's different.

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Based on information from the 2022 Chase 4Q Earnings Supplement, Page 12

Bank of America 2022 4Q Earnings Supplement, Page 14

Wells Fargo 2022 4Q Earnings Supplement, Page 10

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Novo is a fintech, not a bank. Banking services provided by Middlesex Federal Savings F.A.; Member FDIC.

Written by: Novo