It would be nice to think that several of the big banks who are now rethinking their proposed debit card and other fees are doing so because of this blog and the many others like it. A more likely explanation is that they have had an earful from their customers and, as outlined in my last post here, it is very easy for customers to vote with their feet and take their business and money elsewhere. As a result, the word on the street today is that Bank of America may drop their proposed fee entirely. Let’s hope so!
One incredible statistic that was of particular interest is that in the past month, the National Association of Federal Credit Unions recorded a 350 percent increase in Web traffic to its online credit union locator, CUlookup.com. That tells me that savvy comparison shoppers like you have quickly learned not to simply accept the ridiculous add-on fees as inevitable.
Thus far it looks like Bank of America, Wells Fargo and JP Morgan Chase are all reconsidering the additional fees or at least how and when new fees might be implemented. According to the Nilson Report, these 3 banks account for about half of all debit card transactions in the U.S.
Keep in mind that what caused this flurry of fee activity was the recent implementation of legislation that drastically reduced the “swipe fees” banks can charge each time you use your debit card. Effective October 1st, these hidden fees have been effectively reduced from an average of about 44 cents to just 24 cents, a decrease of about 45%. Estimates place the total amount of debit card swipe fees in 2010 at about $20 billion, so you can certainly see why the big banks are now scrambling for ways to replace that lost revenue.
This story is still unfolding, and if the Bank of America rumor today is true, we will all need to continue to be vigilant, as I’m sure we haven’t seen the last of this constant fee assault.