Banking experts discourage large withdrawals amid coronavirus pandemic

Posted at 10:19 PM, Mar 18, 2020
and last updated 2020-03-18 23:45:46-04

KANSAS CITY, Mo. — On Wednesday, Community America Credit Union joined the growing list of financial institutions closing lobbies and encouraging alternative ways of banking in a move to protect customers from COVID-19.

"Virtually everything that we've been able to do in the branch we're going to be able to do through our drive throughs," said Rick Schier, chief member officer for Community America Credit Union.

Customers have been asking whether or not they should withdraw cash, and Schier said not to.

"We are absolutely telling them no, don't take the cash out it's safer where it's at," Schier said.

While some have rushed to make large withdrawals in cities like New York, banking experts strongly advice against it.

"Visa, Mastercard gives you some additional rights as a consumer, that you're going to be able to help yourself if something gets lost, if something gets stolen, so it makes a lot more sense that if you buy something with cash," Schier said.

Arvest Bank agreed and said that institutions like theirs are members of Federal Deposit Insurance Corporation, meaning any deposits are protected up to at least $250,000.

"We have contingency plans designed to ensure uninterrupted bank operations," Shalea Walter, Vice President, Marketing Manager for Arvest Bank said in a statement. "We are actively monitoring the effects of COVID-19 and will adapt appropriately if needed to support our customers, community members and associates."

Schier said that most financial institutions, including Community America, are "very highly capitalized."

"We are in a very stable position," Schier said. "So there's not going to be an issue with any kind of financial or run on the banks."

Some banking customers like Reggie Chapman are heeding the advice.

"Instead of carrying around a bunch of cash, it's better for me to come here and get out what I need and as I need it and go that way," Chapman said.

While there's volatility in the markets amid the global pandemic, bankers said this is more of a health crisis.

"It's going to have some financial implications and impact in it," Schier said. "But this is not a financial crisis at this point."