Banks to Start Charging Debit Card Users?

[lordofthereef]

Wells Fargo's $3 Debit Card Charge: A Sign of More Bank Fees to Come? - DailyFinance

Sucks. I bet this is a direct response to laws that greatly reduced maximum service fee charges on debit transactions.

 

[OutofDate1980]

Well, when you're too big to fail and no competition what's not to love, if you are eligible for that big fat bonus gratis of the US taxpayer.

 

[lordofthereef]

$3 a month isn't that much. I pay more for a silly text messaging plan. But it is the principle. I guess I could "stick it to the man" and not use my debit card anymore, but there are a couple problems. I don't like the idea of carrying around cash. I feel safer knowing that I can just swipe my debit card virtually anywhere. If I go on a long bike ride I take my ID, my debit card, and some water. That's it. There is also the convenience factor. Just for that, I will probably end up dealing with the fees, and the banks know it.

I wonder if ATM deposits/withdrawals are considered a debit transaction?

 

[OutofDate1980]

... I wonder if ATM deposits/withdrawals are considered a debit transaction?

"In another strategy to offset anticipated losses from the upcoming Fed reductions, Bank of America (BAC) already raised its ATM fee to $3."

If available, you might want to check out Credit Unions.

 

[A.Nonymous]

Strange how things like this work out. You pass a law to hit the pocket books of the big company and they turn around and pass that cost along to their customers. No one saw that coming.

 

[Vihzel]

Thankfully I can keep my Chase student checking account until 25 so no monthly charges for me!

 

[noah way]

Strange how things like this work out. You pass a law to hit the pocket books of the big company and they turn around and pass that cost along to their customers. No one saw that coming.

Even blind people saw that coming.

 

[BringItSon]

This is sad... Credit card already charges 3 % on ALL TRANSACTIONS to vendors.

believe it or not, that is shit tons for doing very little. now they are charging the users as well?? i will take my business elsewhere.

 

[OutofDate1980]

... i will take my business elsewhere.

You are fortunate to have that ability. These banks aren't stupid and calculated that they had enough markets without competition to more than compensate for diminished demand where folks have that ability.

 

[Frisco]

A while back I got paranoid after reading one of those identity theft articles about debit cards, so I started carrying cash for incidental purchases and only using my debit card rarely, such as when I got my Droid 3 a month or so ago.

There was a time when I whipped out my debit card for everything, even just to stop at the store to grab something for lunch or whatever. No more.. and now I have one more reason to use cash more often if my bank is going to start charging for debit card use.

 

[A.Nonymous]

Even blind people saw that coming.

Apparently they didn't since the prevailing philosophy in Washington seems to be that corporations are evil and make too much money and they need to be punished in some way. We do this by raising their taxes and operating costs. They pass this on to their consumers and everyone is shocked and this somehow reinforces how evil they are.

 

[lordofthereef]

This is sad... Credit card already charges 3 % on ALL TRANSACTIONS to vendors.

believe it or not, that is shit tons for doing very little. now they are charging the users as well?? i will take my business elsewhere.

This is being dropped to something like 1% (don't quote me on the percent but I know that it is dropping far below 3%). To be clear, I am referring to debit, not credit.

 

[lordofthereef]

Apparently they didn't since the prevailing philosophy in Washington seems to be that corporations are evil and make too much money and they need to be punished in some way. We do this by raising their taxes and operating costs. They pass this on to their consumers and everyone is shocked and this somehow reinforces how evil they are.

FWIW this $3 fee will come nowhere close to bringing in the money they did with their percentage based fees. I actually see that as potentially hurting the company in the long run as people who hadn't been using their cards much are just going to opt to cash/check payments. Could be wrong though.

Also, corporations tend to make more money with these laws because they end up spending less on their customer's debit transactions. It's banks (and consumers) that are hurt here. That's it, really.

 

[gvillager]

This is sad... Credit card already charges 3 % on ALL TRANSACTIONS to vendors.

believe it or not, that is shit tons for doing very little. now they are charging the users as well?? i will take my business elsewhere.

That's what I did. My bank raised their ATM rates so I switched to an online bank, now all my ATM fees are refunded to me at the end of my statement cycle.

A while back I got paranoid after reading one of those identity theft articles about debit cards, so I started carrying cash for incidental purchases and only using my debit card rarely, such as when I got my Droid 3 a month or so ago.

There was a time when I whipped out my debit card for everything, even just to stop at the store to grab something for lunch or whatever.

I do the same, one of my credit card numbers was stolen. I only used this card when I traveled for work, it was easier to track my expenses and get reimbursed. About a week after one of my trips my credit card company called, suspicious internet transactions were showing up. They were good about taking care of the issue without endless amounts of paperwork. I found out later that the waitress at one of the places I ate at stole the numbers and was doing the same to a lot of other customers.

Since then I rarely use my debit card for anything more than ATM withdraws. I no longer use my credit card in situations where I can't watch them swipe the card.

 

[lordofthereef]

Pardon my ignorance, but how does one's identity get stolen through CC information? If there are fraudulent charges, they are reversed by (most) banks. Wouldn't they need a little more info outside of just your CC to actually steal your identity?

I too have had fraudulent charges. They were reversed, I got a new card sent to me, and that was that.

 

[noah way]

Quote form the OP's linked article:

"Wells Fargo estimated it would save more than $200 million in losses with the $3 debit card fee."

Meanwhile, Bloomberg reports:

Wells Fargo Advances on Record Profit, Cost-Cutting Plans

 

[lordofthereef]

Quote form the OP's linked article:

"Wells Fargo estimated it would save more than $200 million in losses with the $3 debit card fee."

Meanwhile, Bloomberg reports:

Wells Fargo Advances on Record Profit, Cost-Cutting Plans

To be fair, $200 million in losses is projected losses as percentage collected per transaction drops. Well's may be making money elsewhere, but they will be making less on this front. It's a tough call. If a company is making money overall, should they be forced to lose money in other ways?

 

[noah way]

To be fair, $200 million in losses is projected losses as percentage collected per transaction drops. Well's may be making money elsewhere, but they will be making less on this front. It's a tough call. If a company is making money overall, should they be forced to lose money in other ways?

You may have missed the point.

The first article said they were in the red and needed to raise fees to reduce losses. The second article highlights the misrepresentation of the first.

 

[lordofthereef]

You may have missed the point.

The first article said they were in the red and needed to raise fees to reduce losses. The second article highlights the misrepresentation of the first.

I did miss that, but my point still remains, no? They will be making less money once percentages are force lowered so they look for ways to make it up? Is it moral? Maybe not. But what can be done, really?

 

[A.Nonymous]

I did miss that, but my point still remains, no? They will be making less money once percentages are force lowered so they look for ways to make it up? Is it moral? Maybe not. But what can be done, really?

I'm curious how and why it would be immoral for a company to make money.

 

[lordofthereef]

I'm curious how and why it would be immoral for a company to make money.

It's never immoral for a company to make money (I guess I should quantify this statement. The simple act of making money isn't immoral. What is done to make the money may be). It is immoral to start charging for a service that you never charged for because you might make less money overall. You know, there are people that join banks and credit unions because of perks they offer. Once they start rescinding these perks, I see moral issues with it.

Oh, on top of that, they did accept a bail-out, funded by the very people who use their services (the taxpayers). It has since been repaid, but still. Way to stick it to your own customers and supporters. This too, is immoral, in my eyes. "Thanks for the help, SUCKERS!"

 

[batgeek]

business and morality? you do not live in the real world.

 

[lordofthereef]

Oh I am not expecting them to be moral. I was asked how they were acting immorally and responded with what I think to be an appropriate answer. There certainly are businesses that deal every day with morality though. The medical field comes to mind.

 

[A.Nonymous]

It's never immoral for a company to make money (I guess I should quantify this statement. The simple act of making money isn't immoral. What is done to make the money may be). It is immoral to start charging for a service that you never charged for because you might make less money overall. You know, there are people that join banks and credit unions because of perks they offer. Once they start rescinding these perks, I see moral issues with it.

I don't know if I agree with that. Let's take Google and Android for a second. Now, Google spends tons of money and manpower on developing Android, but gives it away free. Why? Because they make money on the mobile ad revenue and mobile search not to mention the sale of apps and other mobile content. No one has any issues with that. The mobile revenue that Google gets justifies it spending it's time/money on developing Android.

But let's say that, for some weird and bizarre reason, some law is passed that severely cuts into the revenue Google makes off Android to the point that the mobile revenue is significantly less. Would you think it was immoral if Google started charging a licensing fee to OEMS for using Android?

 

[Vehtemas]

Everyone can change financial institutions.

Example:

I use Alliant Credit Union based out of Chicago. I live in Ohio and have never lived in Chicago.

I made a $10 donation to an organization to get this account, but now I can scan deposit checks at any time (instant credit after 4 months of account in good standing), can withdraw money from ANY CU ATM, and deposit money into most big bank ATMs at no fee (US Bank, Bank of America, and Huntington to name a few).