Credit card companies, banks and financial institutions are always pressing to get us to switch over to e-statements and give up paper. Here's why you should think twice before they convince you to "go green."
I hate to admit it: When my paper credit card statements urge me to “go paperless,” I suffer a pang of guilt, and then I pass up the offer.
I try to be green in most ways, and I hate to feel like a dinosaur stuck in the Analog Age, but having the tangible bill in hand is a useful reminder to me. I keep it in a place that reminds me to pay it. If there are any questionable charges or fees on the bill, I make a note on it, and keep it on my desk until it’s resolved.
As it turns out, I am not alone in preferring the paper record for certain kinds of bills and financial statements. Even though there is an environmental case for going paperless — and it certainly saves tons of money for the companies that otherwise send you paper bills — the e-version is not better than paper for many people.
In fact, some consumer advocates are pushing back against institutions that are pressuring customers to sign on to electronic statements.
“Bank account, credit card and mortgage statements provide important information and serve a critical consumer protection function,” argues the National Consumer Law Center, a nonprofit consumer advocacy organization in Washington, D.C. “For many consumers, from those without regular broadband internet access to the most computer savvy, paper is a more reliable way of ensuring that the consumer actually sees the information and can retain important records.”
In a new report, the NCLC is urging that paper statements should be available for free and that customers who prefer paper should not be steered into electronic billing by default. Here’s why:
Uneven digital access
The digital divide — which separates people who have broadband access, computer literacy and electronic devices from those who don’t — is one of the NCLC’s chief arguments against pressuring customers to go paperless.
The report says that 59 percent of households with incomes under $20,000 do not have broadband access at home. About half of older Americans, Hispanics and African-Americans have no home access to broadband. It says:
Even those with access may have older computers, slow connection speeds, or may lack a printer or money to afford expensive ink to print statements.
E-statements are easy to overlook — and we often do so
But even people armed to the teeth with digital devices and know-how may not choose to switch to e-statements when given a choice. One reason people give is that they are overwhelmed by email. So the message that says “Your Statement Is Ready” gets buried in the never-ending flow of messages coming through email. One thing that makes it different from email is that important email is harder to differentiate from junk at a glance.
An aside: Yes, there are excellent ways to organize our computers, our email inbox and our passwords. Eventually, perhaps all of us will have these skills and tools in place. And here are some ideas about how to get started on that:
- “5 Password Managers to Keep All Your Secrets Safe“
- “3 Steps to Escape Email Hell“
- “5 Easy Steps to Keep Your Computer and Tech Safe in 2016“
Electronic barriers and reasons to procrastinate
In the meantime, though, many people are challenged by the organizational and security needs of doing things digitally. The NCLC says these issues often prevent people from reviewing the critical information in e-statements:
[I]t takes effort to remember the task, find the free time, go to the correct webpage, remember their password, and download the document — as opposed to simply opening an envelope.
A 2015 study by the Consumer Protection Financial Bureau found that more than half of consumers who opted out of paper in favor of electronic credit card statements were not opening or reviewing the e-statements.
The fine print tends to get lost
Paper credit card statements are easy to review, as they show not only the most recent transactions, but also the year-to-date fees. In the case of mortgage statements, they inform us of variable interest rate changes, changes in the escrow amount, and any change to monthly required payments.
Failing to see these documents — or looking at them on something like a mobile device with a tiny screen — can leave you with incomplete information, making you vulnerable to payment mistakes, or making it harder to notice when fraud has occurred.
Again, if you’re very well-organized and confident that you’ll look for all the essential information on an e-statement, the option is there for you. If you have a flawed sense of electronic organization (as I do), you might want to think twice about giving up your paper statements.
I’ve been thinking about the environmental costs of paper statements. I notice when I do a casual internet search that there are lots of financial institutions singing the environmental praises of e-statements. However, I do not see environmental groups that are particularly focused on the issue.
By comparison, many groups and consumers are battling junk snail mail, including a continuous stream of credit card offers. Looking at the pile of dreck that showed up in my mailbox just today, I think I will stick with my paper financial statements — and join the forces of good against junk mail.
What’s your way of handling financial statements? Do you go for paper or electronic statements or maybe a mix? Share with us in comments below or on our Facebook page.