Bank of America to charge $5 debit card fee

[Texas Proud]

Im confused.
Ive got a BofA card that can be used either as credit OR debit.
I use it only as credit- and the payment is automatically and immediately made from my account. So, it effectively acts like debit card even when used as a credit card.
Is this use as a credit card subject to the new 5$ fee??

Then it is a debit card.... with no credit attached.... you must be mistaken on what you think you have...

 

[Texas Proud]

Something just crossed my mind about using my BOA debit card. As I recall, I can use my bank card as a debit or credit. As a credit card, the money still comes out of checking the instant I use it, but you have to sign for it like any other credit card. I for one don't like getting credit card bills at the end of the month except for gas purchases, and larger $ purchases. I hate to think of buying groceries on the credit card. I'll either have to change my thinking on that and start charging everything or just use my debit card as a credit card by not puttting in a pin number. Maybe I'll have to change and get into the "rewards" frame of mind.

Like Ken, I think you are mistaken in thinking that it is a credit card... you can use your debit with pin or signature, but if they take the money out of your account the instant you use it, it is a debit card pure and simple... also without the CC protections that you might think you have...


AFAIK, you can have either a debit card OR a credit card, but not both in one card... maybe someone can prove me wrong...

 

[Texas Proud]

One of the radio people today mentioned the $5 charge and said that all customers should go to their bank and close out their accounts...

I think if there were enough people who did this, the fee would be removed pretty quickly...


Also, I do not understand some people who say they have to stay with a bank because they have a loan or because of their bill pay or whatever... heck, all big banks have these... most small banks have these... and you do NOT have to pay off the loan if you move your checking...


AND, you can just open up a second checking account at another bank and leave open your BofA account and just not use it.... I have had an account at Cap One for years without any activity....

 

[Independent]

The $5 fee is fine with me.

I'm a cash buyer, so I've been subsidizing the people who use credit cards and debit cards for years. If the retailers stop paying so much to the plastic companies, they can start giving me better prices.

 

[Nemo2]

I for one don't like getting credit card bills at the end of the month except for gas purchases, and larger $ purchases. I hate to think of buying groceries on the credit card.

You spend what you spend, and you pay for it, either immediately or when the statement's due; only difference, as I see it, is that in the latter instance you're using the banks money for a while.

 

[GusLevy]

Thanks, BofA. Looks like you are kindling competition in the marketplace. Making sure the 'little people' in your branch are properly demotivated with the 'For Sale or Lease' sign on the front of your branch probably helps, too. (Yeah. Good grief.)

Another poster, BestWife, referenced earlier in this thread regarding Congressional legislation which is directly driving these fees. I don't think anyone else mentioned it but it should be the crux of this discussion. IMO, Durbin's bill is yet another example of the Law of Unintended Consequences through poorly thought out regulation from our Congress as they, rather than the banks, are "kindling competition in the marketplace". The small local banks are obviously using this PR hit for the Big Banks as a loss leader to draw in more customers...with the eventual goal of becoming a Big Bank themselves one day.

Did Congress Kill the Debit Card? - Daniel Indiviglio - Business - The Atlantic

 

[Sue J]

My bank just updated their fee schedule and I will still have free checking. It's now $10/mo to have the Savings account unless you have a $500 minimum balance, but that's no big deal because we keep more than that in the local savings anyway. I'm another one who uses PenFed VISA for all purchases (5% cashback on gas and 1% on everything else) and then I pay it in full when the statement posts. My local bank has some convoluted points reward program for using your debit card and online billpay but I prefer PenFed's cash reward posted to my account. I haven't used the debit card in years.

Our son told me that the only reason he still keeps his local savings account is to have the $500 minimum balance to avoid the monthly charge. He also has online ING savings and checking accounts with no fee ATM access and he's probably going to close his local savings account.

I should probably simplify my banking. All my accounts are still free but I have too many accounts, local and online. I keep track easily enough but if something should happen to me DH would be burdened by the multiple accounts I've used just to gain an extra .5% here and there. It was worth the trouble when rates were better.

I'm old fashioned, I still want to use the local bank on the corner (where I have the bank account numbers memorized!) even though I have accounts at a bank 10 minutes away. But the bank 10 minutes away is on a very busy corner and it's a major pain to make a left turn out of the parking lot!

If my free accounts start to cost me money, they are GONE.

 

[Texas Proud]

Another poster, BestWife, referenced earlier in this thread regarding Congressional legislation which is directly driving these fees. I don't think anyone else mentioned it but it should be the crux of this discussion. IMO, Durbin's bill is yet another example of the Law of Unintended Consequences through poorly thought out regulation from our Congress as they, rather than the banks, are "kindling competition in the marketplace". The small local banks are obviously using this PR hit for the Big Banks as a loss leader to draw in more customers...with the eventual goal of becoming a Big Bank themselves one day.

Did Congress Kill the Debit Card? - Daniel Indiviglio - Business - The Atlantic

Banks make a lot of money off fees... and the 'gotchas' they create...

They will still be making a ton of money off of debit cards, just not as much...


As an example..... this is old, but probably still true... back in the day it cost a bank less than 15 cents to process a bounced check... but charged the customer $15... the customer had to pay that fee because it was listed in the costs of the account... but then banks thought... we can get MORE fees if we pay the largest check first and then the smaller checks after that so we can run up the number of bounced checks... a 'gotcha' kind of fee... because of this, they got slapped down with a law...

Same for the debit fee....

I still say that if millions of people went to BofA and closed out their account because of that fee.... it would be stopped very quickly... it is only when a fee is accepted by the masses that it sticks (such as all the fees the airlines charge)...

 

[jayc]

IMO, Durbin's bill is yet another example of the Law of Unintended Consequences through poorly thought out regulation from our Congress as they, rather than the banks, are "kindling competition in the marketplace".

Nothing unintended at all. Calculated, planned, and executed by the banks and congress. Durbin has been in their pocket for years.

 

[pimpmyretirement]

For those looking to leave Bank of America, USAA checking is pretty awesome. Free checks, ATM fees are refunded and if you also get a credit card through them, you can deposit checks at home via your scanner or smartphone. They've got free online bill pay too, but I've never used it.

The deposit from home is what sold me on them. It works great.

 

[REWahoo]

For those looking to leave Bank of America, USAA checking is pretty awesome.

FYI, USAA posted this on their website regarding charging debit card fees:

USAA Bank Reaffirms Its 'Fee-losophy' of Free Debit, Free Checking

Posted on Sep 29, 2011

In an environment with some major banks making plans to charge customers new monthly fees for using their debit cards, USAA Bank announced today it has no plans to add fees to its debit card. USAA Bank remains committed to offering a free checking account — and free debit card — with superior features...

 

[Trex]

Another poster, BestWife, referenced earlier in this thread regarding Congressional legislation which is directly driving these fees. I don't think anyone else mentioned it but it should be the crux of this discussion. IMO, Durbin's bill is yet another example of the Law of Unintended Consequences through poorly thought out regulation from our Congress as they, rather than the banks, are "kindling competition in the marketplace". The small local banks are obviously using this PR hit for the Big Banks as a loss leader to draw in more customers...with the eventual goal of becoming a Big Bank themselves one day.

Did Congress Kill the Debit Card? - Daniel Indiviglio - Business - The Atlantic

Mr. Gus....you're "Right On", on your comments concerning "congress" and the "unintended consequences" from there actions!

I guess I will need to apply for a credit card and start using it...but, I still want to move my money to another bank if I can find the same interest rates for my home equity loan with BofA, (2.99%).

So far, I haven't had any luck, finding another bank with the same or lower interest rates. Redding is a small town... so my options are low, when it comes to banks & CU's.

The only good news is... I got ATT to reduce my mouthly bill by $27 bucks! From $42 to $15, plus taxes. I told them on the phone that I wanted to shut down my home phone with them. They came back with a counter offer... to lower my mouthly for 12 months.

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[JOHNNIE36]

I guess I am the only one ....who does not use an ATM card or Debit card. I still write checks, use cash or my 1 credit card I've had the last 35 years. Works for me...and I don't feel inconvenienced at all. But as a woman, I carry a purse... can carry more stuff than what can fit in a back pocket.

You might have been the lady in front of me the other day at the grocery store that waited for the cashier to tell her the amount of the purchase and then proceeded to get the check book out of her purse and started the writing process with date, store name, her name (all things that could have already been on the check), followed by the amount and then entered it in her check register and did the subtraction and balance. Aaaarrrggggghhh!!!!

 

[JOHNNIE36]

Like Ken, I think you are mistaken in thinking that it is a credit card... you can use your debit with pin or signature, but if they take the money out of your account the instant you use it, it is a debit card pure and simple... also without the CC protections that you might think you have...


AFAIK, you can have either a debit card OR a credit card, but not both in one card... maybe someone can prove me wrong...

Yeah Tex, I just found that out for myself. Went to the store for some purchases. Got out my BOA debit card. Credit card machine said to enter debit or credit, I push credit. Transaction goes through and I have to sign on the machine. Got home and went to online banking to check this transaction and it went through as a debit anyway. So, regardless of how you use the card, it's going to result in a debit transaction and would trigger the fee.

 

[REWahoo]

So far, I haven't had any luck, finding another bank with the same or lower interest rates. Redding is a small town... so my options are low, when it comes to banks & CU's.

This new fancy-schmancy internet doo-dad means you can 'bank' with financial institutions all over the place - even outside the city limits!

 

[scrabbler1]

Yeah Tex, I just found that out for myself. Went to the store for some purchases. Got out my BOA debit card. Credit card machine said to enter debit or credit, I push credit. Transaction goes through and I have to sign on the machine. Got home and went to online banking to check this transaction and it went through as a debit anyway. So, regardless of how you use the card, it's going to result in a debit transaction and would trigger the fee.

This is consistent with what the BofA rep told me when I asked him (in person, at my local bank) about the different uses of a debit card. When you use a debit card, you are asked for a PIN.....but, if you use your debit card and you can't enter a PIN (i.e. you hand it to a restaurant server), then you have to sign a charge slip although the money is still taken out of your account the exact same way as if you had used a PIN.

 

[JOHNNIE36]

I'm sure I don't have a smart phone, but I could possibly have a finger-chip. I'll have to check that. Like some others here, I'm puzzled about what use anyone would have for a BOA debit card. I do have a debit card, but it's only to use the ATM machine of my local bank. BOA doesn't have ATM machines hereabouts, so far as I know. Is that an East coast thing?

Maybe I'm missing something in your question, but here in Florida and most other states I know of, I use the debit card at ANY establishment that sells anything (I think). Works just like a credit card but you don't have to sign any document, usually just enter a pin number and your debit card works just like cash. I also use the debit card at the BOA ATM to deposit checks or cash rather than go into the bank. Also, with a debit card I can purchase something and get cash back from the merchant if I need it. The cash back just becomes part of the purchase process. At WalMart I can get back up to $100. Easier than going to the bank.

Note, have found a few places that won't accept credit or debit cards because of the fees. Cash or local check only.

 

[M Paquette]

I hate to think of buying groceries on the credit card. I'll either have to change my thinking on that and start charging everything or just use my debit card as a credit card by not puttting in a pin number.

Knowing BofA, they'll probably charge the merchant the higher credit card fee AND ding you the five bucks for using your debit card that month. It'll be clearly detailed in the 24 page brochure of fine print that they mail out.

 

[JOHNNIE36]

Knowing BofA, they'll probably charge the merchant the higher credit card fee AND ding you the five bucks for using your debit card that month. It'll be clearly detailed in the 24 page brochure of fine print that they mail out.

 

[GregLee]

... and your debit card works just like cash.

I suppose my debit card works that way, too, but I've never used it that way, because I didn't see the point. I use a credit card for almost every purchase. Long ago, I could use my credit card for my bank's ATM machines, too, but the bank decided that only debit cards would work in its ATM machines, and that's the only reason I acquired a debit card. It's okay -- the debit card is not very heavy.

I also use the debit card at the BOA ATM to deposit checks or cash rather than go into the bank. Also, with a debit card I can purchase something and get cash back from the merchant if I need it.

My Discover credit card does the cash back thing, up to $60 or so. And they've stopped requiring a signature for small purchases made with a credit card. My Chase card supposedly no longer requires a swipe; you just wave it in the air, but my local stores don't yet have credit card stations that accept the wave feature.

 

[Finance Dave]

I don't want to get too much into the politics, but our government, in their quest to "protect" us consumers from unfair practices, put in place such protections that the banks had to look for different ways to raise money, and this is the outcome.

Used to be that those with low FICO scores paid all the penalties in terms of higher rates on their cards, but now they'll have to spread those costs out to all users in the form of debit card fees and other such fees.

I say get the government out of this, and let people walk with their feet if they don't like the fees they are being charged. It would be great if there was a PRIVATE consumer protection division and people joined it and used it. Probably the closest we have to that is Consumer Reports. I wish they'd come out with a TV network focusing only on such things...I'd gladly pay for it as a premium channel. However, 50% of the US population is too busy watching "Dancing with the stars" and "The Jerry Springer" show to spend time learning how to be a wise consumer.

 

[Texas Proud]

I suppose my debit card works that way, too, but I've never used it that way, because I didn't see the point. I use a credit card for almost every purchase. Long ago, I could use my credit card for my bank's ATM machines, too, but the bank decided that only debit cards would work in its ATM machines, and that's the only reason I acquired a debit card. It's okay -- the debit card is not very heavy.
My Discover credit card does the cash back thing, up to $60 or so. And they've stopped requiring a signature for small purchases made with a credit card. My Chase card supposedly no longer requires a swipe; you just wave it in the air, but my local stores don't yet have credit card stations that accept the wave feature.

But having a debit card in your wallet also has some downside... if you lost your wallet or it was stolen, the person could use your debit card and wipe out your account...

Sure, at some time in the future you would most likely get your money back, but you also might have some bounced checks you have to handle etc. etc.

I refused the debit card and insisted they give me the old fashioned ATM card... no Mastercard or Visa logo on mine... it ONLY works in an ATM machine... and you have to have the pin... YMMV...

 

[Sarah in SC]

I don't want to get too much into the politics, but our government, in their quest to "protect" us consumers from unfair practices, put in place such protections that the banks had to look for different ways to raise money, and this is the outcome.

Used to be that those with low FICO scores paid all the penalties in terms of higher rates on their cards, but now they'll have to spread those costs out to all users in the form of debit card fees and other such fees.

I say get the government out of this, and let people walk with their feet if they don't like the fees they are being charged. It would be great if there was a PRIVATE consumer protection division and people joined it and used it. Probably the closest we have to that is Consumer Reports. I wish they'd come out with a TV network focusing only on such things...I'd gladly pay for it as a premium channel. However, 50% of the US population is too busy watching "Dancing with the stars" and "The Jerry Springer" show to spend time learning how to be a wise consumer.

+1 and then some. This is the post I would have liked to have made, Dave. These unintended but entirely expected outcomes of the drive to "protect" consumers will keep coming.

 

[GregLee]

However, 50% of the US population is too busy watching "Dancing with the stars" and "The Jerry Springer" show to spend time learning how to be a wise consumer.

I don't see the problem here. Let Dick Durbin watch the banks for me so I have more time to watch "Dancing with the stars". Life's too short to spend it in paroxysms of paranoid looking over your shoulder. Besides, I won't be paying any debit card fees.

 

[ER Man]

Anyone holding BAC? Where is the stock going in the next 12 months?