Friday, September 30, 2011

What do you think of Bank of America's $5 debit card fee?

Ron Swanson - Photo credit: nbc.com
I'm not a Bank of America customer anymore. I haven't been for a while. But the announcement of their $5 monthly fee for the privilege of having a debit card really bugs me. It more than bugs me.

We haven't used a credit card in three years. Or more? A little more. But we do use a debit card. We have to. It's the only way we can buy anything online. And they're handy. Most places don't take personal checks, but they do take debit cards. Debit cards makes life a lot easier when you're living a cash-based life. It eliminates the need to go to the teller at the bank... and only during bank hours. Making sure you have enough cash, etc. And it eliminates the need to carry a lot of cash on your person.

If my bank (Chase) were to start charging a $5 fee to have a debit card, I would switch banks. Seriously. Why? Because I already get charged transaction fees. And this $5 fee is for what, exactly?

Well, according to a Wall Street Journal article,

"The industry says it needs the fees to recoup revenue it will lose because of new government regulations taking effect Saturday that cap what they can charge merchants for debit-card transactions."

So they are trying to make up lost revenue by charging the debit card holder instead of the merchant. Sigh. This is business. I know. But I don't have to like it. Not at all.


More from the Wall Street Journal:

"The economics of offering a debit card have changed with recent regulations," a spokeswoman for Bank of America said Thursday.
In its internal memo, Bank of America said it will levy the $5 fee each billing cycle in which a customer uses a debit card to make a purchase. The fee will not be triggered by transactions at automated-teller machines.
The fee will apply to standard checking accounts, but not most premium accounts held by affluent customers. Banks typically exempt their premium accounts from many fees because they tend to be more profitable than standard accounts with lower balances.

I wonder how long it will take for all the banks to follow suit. I know that right now some banks are using the BOA announcement to brag about the fact that they don't charge a monthly fee. Yet.

Maybe Ron Swanson has it right. Time to buy gold and bury it in lots of different places. Then bury decoy gold to throw off your exes. Ah, I love Parks & Recreation. Don't you?

What do you think about all of this? Is it fair? Is it nonsense? Or is it just business? 

Would you change banks on principal?

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