Bank of America to charge $5 monthy fee for debit card use
Oct. 1, 2011 at 5:01 a.m.
NEW YORK (AP) - Angela Malerba, who works in public relations in Boston, carries a debit card because she likes to know when she buys something that she has enough in her account to pay for it. But paying $5 a month to use her own money? That's too much.
So when Bank of America starts charging the fee next year, Malerba figures she'll rely more heavily on her credit card. Or, in a strategy that seems almost quaint in these swipe-and-go times, she may just carry more cash.
"Paying $60 a year in debit card fees just seems absurd," she says.
The 38.7 million people who carry Bank of America debit cards will face a similar decision in the latest example of banks raising fees or establishing new ones - not just for debit cards but for visiting ATMs or talking to a teller.
Bank of America's announcement follows tests by Wells Fargo and Chase for $3 monthly fees for debit cards in some markets. Other banks have begun charging for basic checking. Banks have sharply restricted their rewards programs for debit cards.
Bank of America said the fee will apply only when customers use their debit cards for purchases in a certain month. The fee will not apply if the card is used only to access ATMs. It will not apply for premium customers, who keep high balances.
Debit fees hit particularly hard because banks have spent the past decade encouraging their customers to go for the ease of the cards, which deduct purchases immediately from a checking or savings account.