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Randolph Brooks gives cash back on debit purchases
LIVE OAK, Texas (10/4/11)--Unlike megabanks that are hiking debit-card fees, a new program at Randolph-Brooks FCU (RBFCU) in Live Oak, Texas, will give members cash back on debit-card purchases. Until Dec. 31, RBFCU will reward members with 15 cents cash back on every debit card purchase. The credit union currently pays members 10 cents for each transaction, but chose to increase the reward as a member-appreciation program for the end of the year. “We’ve watched other financial institutions put new fees in place and we know that’s not what members need during a time when the economy is struggling,” said Sonya McDonald, senior vice president of market development. “Instead of upping our fees, we chose to increase rewards. Since we’ve experienced record growth this year, we decided to use the extra funds as a thank you to the members who have made this growth possible.” The $4.4 billion asset credit union also plans to reward members who use its MasterCard credit cards with 5% cash back on each fuel purchase. Consumers have objections to Bank of America (BofA) and other large banks raising fees to cover lost revenues caused by the Federal Reserve’s debit card interchange rule (See related News Now story “Nat’l media intensify reports on CUs’ debit-fee relief). It was widely reported Thursday that Bank of America has plans to begin charging a $5 monthly fee to some debit-card users (News Now Sept. 30). The Credit Union National Association (CUNA) is urging the Federal Reserve to increase the amount of per-transaction fees that debit card issuers receive to cover their costs associated with fraud prevention. CUNA also recommended that the Fed periodically revisit the fraud prevention cost issue to see if the costs have changed and whether any future adjustments are necessary. The Fed is required to study and report on how the debit interchange fee cap has impacted merchants, consumers and financial institutions within the next two years (News Now Oct. 3).


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