MADISON, Wis. (11/4/11)--While Bank of America (BofA) and other big banks have dropped plans to charge monthly debit fees, consumers must be more vigilant for less transparent fees. Banks will be seeking to regain revenue lost from the new interchange rule and a stagnant economy, according to industry observers.
BofA will lose as much as $1.2 billion to $1.4 billion in revenues a year by dropping its debit fee, Jefferson Harralson, analyst at Keefe Bruyette & Woods, told the New York Post (Nov. 2). To make up for that lost income, it may impose more fees such as increased requirements for minimum balances, increased monthly fees, maintenance fees and fees for using ATMs for non-customers, Harralson told the Post.
TD Bank, Cherry Hill, N.J., is implementing a new fee and increasing others, a CNNWire report said (Nov 2).
The bank will begin charging its customers a $9 fee each time they withdraw or transfer money from their savings account once they have exceeded six transactions in a billing cycle.
In setting the fee, TD Bank cites Regulation D, which sets the six-transaction limit per billing cycle. BofA and Wells Fargo already have similar fees in place.
In the CNN report, one reader remarked that credit unions look more attractive as big banks continue to search for ways to make money.
Bank fees aren't going away, and credit unions will continue having the opportunity to show consumers the benefits of membership.
Banks also could begin charging customers for more costly services such as processing paper checks and mailing statements, banking analyst Bart Narter said in a Boston Globe (Nov. 3) article.
Rewards programs may also be eliminated at some banks, the Boston Globe said. Citizens Bank, the second-largest retail bank in Massachusetts, will stop offering its GreenSense rewards program at the end of the month. The program gives customers 10 cents each time they make a debit card purchase or electronic payment.
One-third of U.S. banks have cut their debit reward programs during the past year, according to Bankrate.