Bank of America’s $5-a-month debit card fee may not happen next year as initially planned due to extremely negative feedback from Bank of America customers. Reuters, citing “a person familiar with the bank’s plans” says B of A may make it possible for many of their customers to avoid the $5 monthly fee, which has drawn mass amounts of criticism since the plan was revealed last month.
Reuters says “The second largest US bank is likely to allow many customers to avoid taking the fee by taking measures such as maintaining minimum balances, having paychecks directly deposited, or using Bank of America credit cards, the person said”
The news about B of A came out after the report that JPMorgan Chase will drop its test of a similar fee and will not be imposing a debit card fee on any of its Chase customers. Other large bank, including Citibank, US Bank, and PNC, have also stated that they do not have any plans to charge their customers a monthly fee to use their debit cards.
The fact that the banks are no longer going to impose a fee means that the charges will be coming somewhere else. Because of the Durbin Amendment, which cut the amount the banks could charge merchants from an average of $0.44 per transaction down to no more than $0.24, banks are trying to find ways to make up for that lost revenue.
Citibank, which is one of the banks that decided not to charge a monthly debit card fee, has already raised the fee for use of their basic checking account services. “We’re going to see more creative, stealth-like fees,” Dennis Moroney, research director at TowerGroup, told SmartMoney. Among the possibilities:
- A fee for not using your debit card each month
- Fees for papers statements or speaking to a teller. These fees are already in place at some banks
- Higher overdraft fees