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NEW YORK CITY -- Bank of America said it is calling off its plan to charge a $5 monthly fee for customers who use their debit cards to make purchases. It announced in September that it would begin charging the fee in January.
The nation's second-largest bank's reversal on the debit card levy follows widespread backlash from customers and competitive pressure from rival banks who have nixed plans to charge customers for using their debit cards. Last week, JPMorgan Chase and Wells Fargo decided to cancel test programs. This week, SunTrust Banks and Regions Financial Corp. said they would end monthly charges.
"We have listened to our customers very closely over the last few weeks and recognize their concern with our proposed debit usage fee," said BofA co-chief operating officer David Darnell. "Our customers' voices are most important to us. As a result, we are not currently charging the fee and will not be moving forward with any additional plans to do so."
Banks crafted monthly debit card charges as a means of recouping lost revenue from a cap on the debit card swipe fees they could charge merchants under the Durbin Amendment. | SEE STORY
But the new fees the institutions planned to charge sparked pledges by thousands of consumers to move their money out of big banks. Grassroots activists have dubbed Nov. 5 Bank Transfer Day and have been mounting a campaign urging customers of big banks move their accounts to community banks and credit unions.
Meanwhile, the National Automatic Merchandising Association and leading cashless vending providers said they are working with financial institutions to mitigate the damaging effect the new Durbin rates could have on the vending industry. Visa and Mastercard have said they will charge the full 21¢ per transaction allowed for small-ticket debit card transactions, potentially tripling the cost of an average vending transaction. | SEE STORY