Consumers Union, the advocacy arm of Consumer Reports, has sent letters to Bank of America, Chase, Wells Fargo and Sun Trust, calling on them to stop plans to attach fees to debit card purchases.
Bank of America recently announced it would charge its customers $5 a month in order to make debit card transactions starting in 2012. SunTrust has started rolling out its own $5 fee, and Wells Fargo and Chase are also testing new debit card fees in select markets.
The letter to Bank of America states that Consumers Union, "believes your decision to charge consumers a new monthly fee to use their own money for debit card transactions is both ill-timed and unfair." The letter goes on to call the fee costly and arbitrary, and designed to generate revenue rather than cover the cost of debit card services:
Banks can still collect approximately 24 cents from retailers every time a customer makes a debit card purchase. That's much more than the median 8 cents the Federal Reserve estimates it costs a bank to process a debit purchase when consumers use a PIN number.
Consumers Union asked the banks it sent letters to for a response by Nov. 2, to advise the organization of their position. Earlier this month, Consumers Union called on the government and federal regulators to investigate Bank of America’s plan for new debit card fees.
Is your bank planning new fees associated to debit card transactions? If so, here are some tips for avoiding such fees, including what to do if you decide to transfer your money to a new bank in order to avoid such fees. You can also check out additional tips (pdf) at www.DefendYourDollars.org.
Consumers Union Calls On Bank of America & Other Major Banks to Drop Unfair Debit Card Fees [Consumers Union]