Issue Date: Vol. 51, No. 10, October 2011, Posted On: 9/30/2011
New Debit Card Fees Will Appear As Cap Rule Goes Into Effect
by Staff Reporter
debit card fees, debit card swipe fee, Visa fee, MasterCard Fee, Bank of America, BofA, cashless vending, vending business, vending machine business, amusement business, Dodd-Frank financial regulation law, Dick Durbin
NEW YORK CITY -- Beginning Oct. 1, a cap on the fees banks can charge retailers every time customers swipe their debit cards will take effect. The new rules limit the amount banks will be able to get from merchants.
Banks used to charge an average fee of 44¢, but are now limited to a maximum of only 21¢. This is expected to cost the banking industry billions of dollars. The Federal Reserve introduced the cap this summer, which many financial institutions opposed. | SEE STORY
The caps may reduce revenue at U.S. banks by $8 billion, data compiled by Bloomberg Government show. As a result, consumers and merchants will face new fees in different areas. According to news reports, Visa Inc. and MasterCard Inc., the largest consumer payment networks, said they plan to raise debit card fees charged for small-ticket purchases to the full amount allowed under new rules.
Bank of America announced on Sept. 29 that it will begin charging a monthly fee at the beginning of next year to customers who make debit card purchases. Whether they make one purchase with their cards or 20, BofA debit card users will pay $5 a month. They will not be assessed a fee if they don't use their cards for debit purchases, and there will be no new charges for ATM usage.