Score one for debit-card users. They complained loud enough when banks started imposing fees on debit-card purchases that the banks listened.
All five of the large banks that had started charging debit-card fees (or had announced plans to do so) said that they were eliminating them. Over the past several days, JPMorgan Chase, Wells Fargo, Regions Financial Corp. and SunTrust have announced that they wouldn't be charging debit users monthly fees. Bank of America was the one holdout -- until today. It said it was backing off its plans to introduce a $5 monthly debit-card fee in response to "customer feedback and the changing competitive marketplace."
"It's a huge win for consumers," says Alex Matjanec, co-Founder of MyBankTracker.com. The banks had imposed the fees in an attempt to compensate for revenue lost as a result of a new regulation that limits the amount they can charge merchants each time a customer swipes a debit card. But consumer outrage over the new fees prompted the banks to drop them, Matjanec says.
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"You spoke. We listened," proclaims Regions Financial Corp. on its Web site. The bank, which operates in 16 states in the South and Midwest, said October 31 that it would stop charging the $4 monthly debit-card fee for all accounts effective November 1 and will refund fees already incurred. Refunds will be credited automatically to accounts.
SunTrust also announced on October 31 that it was eliminating its $5 monthly debit-card fee starting November 2 and refunding customers who already incurred the fee. The move was made in response to customer feedback, according to a press release from the Atlanta-based bank that operates in the Southeast and Mid-Atlantic states.
The two regional banks followed in the footsteps of the country's biggest bank, JPMorgan Chase, which announced October 28 that it was dropping a $3 debit-card fee that it had been testing in two states. That same day, Wells Fargo & Co. said it was canceling its planned five-state pilot program of a $3 monthly fee for debit users.
Given the recent events, Matjanec says he would be surprised to see any other banks attempt to charge fees on debit-card purchases. However, he says that consumers shouldn't think that their accounts are fee-free now. Many financial institutions have introduced a number of fees over the past year that are, in fact, much higher than the short-lived debit-card fees and aren't going away. That's why it's important for consumers to scrutinize their accounts and look for better banking deals elsewhere if they've been hit with a lot of fees, he says. Check out our list of low-fee and no-fee accounts. For help comparing your options if you want to switch financial institutions, see How to Find a Local Bank.
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