Behind Bank of America’s decision to charge debit card fee
Bank of America anounced $5 monthly fee for debit cards. (Photo: Flicker user MoneyBlogNewz)
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Bank of America announced Thursday that starting next year, it will begin charging a $5 monthly fee for customers who use their debit cards. And customers are already taking out their frustration.
On Twitter, Peter Skeritt wrote “Well. looks like I’ll be closing my Bank of America account before the year is out. Fees mean more revenue only if you have customers.”
Bank of America spokeswoman Anne Pace defended BOA’s move, saying that “the economics of offering a debit card have changed.”
The announcement comes days before a provision of the Dodd-Frank financial overhaul bill called the “Durbin Amendment” takes effect. That rule limits the fees that banks can charge merchants every time a customer uses a debit card for a purchase. And The New York Times reports that Javelin Strategy and Research estimates the new rule would reduce revenue for banks by about $6.6 billion a year.
The Bank of America website’s homepage crashed today, but it’s not known whether the technical issue was related to the bank’s announcement.
Read more on the Here and Now website.
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