New Bank Card Fees
Bank of America plans to start charging a new fee to customers.
The nation's biggest, bank of america, will be charging the biggest of the new debit card fees five dollars a month for customers who use the bank's debit card to make purchases.
The bank also plans to charge anyone who uses their debit card to make recurring payments like a utility bill.
The new fee stems from a rule taking effect Saturday that puts a cap on swiping fees, the fee retailers must pay banks each time a debit card is swiped which at 16 billion dollars a year, was a lucrative source of income for banks.
"The first thing I thought...go to another bank but they're probably all going to do it,” said consumer Connie Edwards.
Indeed, Wells Fargo and Chase have been testing $3 monthly debit card fees while many regional banks will follow Bank of America's five dollar fee.
"It's just another slap in the face for Bank of America customers,” said David Orgo from Arlington Virginia.
Spokesmen for the banking industry say the fees are necessary to make up for lost revenue after the Dodd-Frank Act restricted the way banks make money.
"We don't like doing this. It was the last thing we wanted to do, and unfortunately we were forced to do this by government intervention," said President of Consumer Bankers Association Richard Hunt.
Not all banks are raising fees which consumers’ group say will increase competition.
"Consumers don't have to take it. Rhey have options,” said Pamela Bank from Consumers Union.
Analysts say that because it suffered more in the financial crisis, Bank of America's debit fee is steeper than most of its competitors.