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Some Banks To Charge Monthly Fee For Debit Card Use In U.S.

Some banks are getting set to charge a monthly fee for debit card use in the U.S.

Some banks are getting set to charge a monthly fee for debit card use in the U.S.

Some banks in the United States, including the Bank of America, which is the biggest lender in the U.S. based on assets, have announced plans, or intend to do so soon, to charge a monthly fee, for some of their debit cards. The fees being mentioned are in the $3 to $5 per customer per month per card.

The banks are trying to find ways to make up for the limit that has been mandated  after the Federal Reserve issued rules which have capped what are known as swipe fees. Beginning 1 October, swipe fees are capped at 21 cents, with an additional 0.05 per cent of each transaction, and a 1 cent adjustment related to fraud prevention. Since this is replacing a formula that averaged out at about 1.14 percent, or 44 cents per transaction, this has the potential to limit the revenue for banks by about $8 billion, according to data which has been compiled by Bloomberg Government.

While the Bank of America is set to charge $5 per month for some debit card use starting next year, Wells Fargo is testing a $3 monthly fee for some of their debit cards. They are the second largest issuer of debit cards. Citigroup, known as the third largest bank in the U.S. has said that they will not charge additional debit card fees. The Bank of America does have some plans which will be exempt from these fees for users who keep a large balance in their account, or use other banking services such as online banking.

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Anthony has more than 35 years business experience as an employee, manager, entrepreneur, and consultant. A Trivia buff, Anthony is one of the major contributors to the General News category, too.

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