Skip to comments.Big Banks Blink on New Card Fees
Posted on 10/28/2011 5:00:02 PM PDT by throwback
A month after Bank of America got pummeled by consumers and politicians for introducing plans for new debit-card fees, most other big U.S. banks are steering clear of imposing similar charges.
Following eight months of consumer testing, J.P. Morgan Chase & Co. has decided that it won't charge customers who use their debit cards to make purchases, according to a person familiar with the bank's plans. The New York bank's Chase retail unit is one of the largest U.S. consumer banks, with 26.5 million checking accounts and 5,300 branches.
J.P. Morgan joins U.S. Bancorp, Citigroup Inc., PNC Financial Services Group Inc., KeyCorp and other large banks that have said in recent days that they won't impose monthly fees on debit cards. None of those banks said they made their decisions because of the outcry over Bank of America's fees.
"We looked at all options and quickly decided it didn't fit with our overall strategy," said David Bowen, who runs the consumer-product business at Cleveland-based Key, which ranks among the 20 largest banks in the country.
Banks are loading fees onto customer accounts in an attempt to recover billions of dollars in revenue that will be lost from new restrictions on debit cards, credit cards and overdrafts. Most big banks have already eliminated free checking for customers who don't meet certain criteria on their accounts, such as minimum balances or a certain number of direct deposit transactions.
Bank of America Corp. has begun laying plans to charge millions of customers $5 a month if they use their debit cards to make purchases. The bank is still working out details of its plans, which likely won't affect all customers, according to a person familiar with the situation. SunTrust Banks Inc., Atlanta, is also tacking a $5 monthly fee...
(Excerpt) Read more at online.wsj.com ...
Now THAT takes a set! Take a chunk of an industries' revenue, and then stick your finger in their eye when they attempt to recover it. If I was a Republican in Congress, I'd be holding a press conference and calling Durbin names every day. Cowards.
Maybe they thought (correctly) that they wouldn't lose me as a customer since I don't pay interest anyway, but then again, how does it profit them to raise my rate?
A thorough reading of Jose Ortega y Gassett's essay "Revolt of the Masses" is in order here.
BOA was among the banks that helped put BO into office. They support leftist causes all over the place. I have no sympathy for them.
“in the past two or three of those decades, I have not paid a penny in interest.”
so why would they want you as a customer?
I hope Regions Banks rescinds their monthly $4 use of debit card charge because NOW I’ll be going Cash Only.
I may also change banks if they don’t.
Because, somebody is making around 3% from the merchant, every time a card is used.
A lot of someones get a piece of that 3%. Unless he’s using the card for a lot of purchases they are losing money on him.
Industries don’t have any guaranteed future revenue unless it’s customers are desperate or stupid. These big banks have no real reason to exist and so can’t afford to chase off their customers.
My Dad’s credit is A1 and he never pays interest either and they raised his interest to 29.99% last year. Still pissed him off though.
He pays off the card every month, so you got to wonder what went into that decision.
The banks all offered free checking and credit/debit accounts to people, making all their money on the back end, from the merchants who accept checks or credit/debit cards.The merchants paid fees to the banks, to process checks, credit and debit cards.Naturally, those costs are passed on to the customer.
The government has stipulated the rates banks can charge merchants for transactions, and banks have introduced new fees to checking account members.
Banks are like insurance companies.
They charge fees to guarentee transactions, absent the exchange of cash.
BoA was also one of the biggest supporters of illegals, but for some reason most here on FR rush to their defense nowadays.
SunTrust is pulling the $hit on my wife’s special accounts and she is looking to move all her money to another bank now. She has 4 accounts there and they want to hit 3 of them up with new fees.
Her primary account would still be ATM free but they are going to charge another fee for the checking.
My father literally pays everything on his VISA and then writes a check at the end of the month. They raised his interest to 29.99% last year. Why?
He is never late and they are making plenty of cash off him on merchant fees alone. Its just stupid.
Local banks here in TN are advertising NO fees on checking-debit cards even with low account balances. Get him to switch if he can.
My Dad is in Florida and since he pays no interest, he is not really affected.
My wife is looking at moving her accounts in the next month after she gets some finances in order first to not screw up.
Because I average charging $2,000 or more per month and they make about 3% on that from merchants fees.
I get 2,000 or so points every month accumulated.
they make maybe 1%, there are a lot of middlemen in a credit card transaction.
1% of $2,000 is $20. It costs more than that to have you as a customer. Even if their profit is 3%, thats only $60. Add in those points and you are costing them money.
Again why would they want you as a customer?
No I’m not wrong. Banks make a tiny amount on the transaction. They make most of their money on the interest.