Yakezie.com - Topic: Bank of America

Funancials on Bank of America

Mon, 03 Oct 2011 17:27:36 +0000

Only the bigger banks will follow suit. As the nation's largest debit card issuer, BAC depended heavily on the fee income from debit card interchange fees. With the Durbin Amendment/Dodd-Frank Act limiting what card issuers/merchant processors can charge on transactions, BAC anticipates losing lots of money (over 2 billion to be exact).

The smaller banks haven't received this kind of revenue from interchange fees. Their business model has always been "we'll pay you x% on your savings and lend you x+3% on your loan." I think they will use this as a competitive advantage to increase the # of their households.

Although the word "fee" is thrown around in both situations, I don't see much resemblance to the airline industry. Banks are shifting where they make their money lost due to (unnecessary) government regulation.

I laugh because the Durbin Amendment/Dodd-Frank Act was supposed to benefit small businesses and consumers; however, now consumers will be carrying more of the burden.

As some of you have mentioned above, everyone (that is financially responsible) should be using their credit card rather than debit card; so none of this should matter.

Khaleef @ KNS Financial on Bank of America

Mon, 03 Oct 2011 15:57:07 +0000

I think that most banks will follow this model very quickly.

Matt Wegner on Bank of America

Sun, 02 Oct 2011 07:49:47 +0000

Kind of funny how they're charging you for being more responsible with your money. I don't use credit cards because I always end up spending more than I intended. I would expect many more banks to follow and this will become the norm in a short period of time.

Do you think banks will go back to annual fee credit cards as the norm too?

krantcents on Bank of America

Sat, 01 Oct 2011 08:12:58 +0000

Banks like fee income! They have figured out ways of gaining more fees all the time. It is a little like the airline industry with their fees. It has become very profitable. I think you can expect more banks to hop on board. I think longevity with your bank can work for you if you leverage it regarding fees.

Eric J. Nisall on Bank of America

Sat, 01 Oct 2011 08:02:04 +0000

I don't use my debit card for purchases, and come to think of it, I really don't use the ATM much either, so I may just cancel it if Wells Fargo decides they will implement a monthly fee. Although, if I remember correctly there was a monthly or annual fee back in the late 90's too when debit cards first came around.

Most of the online banks will reimburse the fees charged by the institutions for ATM usage so it may be easier to just go with one of them, even if it's just to keep a little bit of money so you can access the cash at no cost.

Dana on Bank of America

Sat, 01 Oct 2011 03:19:45 +0000

Yep, I think other banks will follow suit pretty quickly.

The Frugal Toad on Bank of America

Fri, 30 Sep 2011 18:50:35 +0000

Heard on the radio that Wells Fargo and Chase will probably follow suit.

This may be a good time to look into a smaller regional bank which will probably not follow the big banks on this fee. If you carry a high balance this fee will most likely be waved.

My Personal Finance Journey on Bank of America

Fri, 30 Sep 2011 18:30:30 +0000

Yeah it's pretty amazing. I'll be making a point not to use my debit card except for ATM transactions.

Sustainable PF on Bank of America

Fri, 30 Sep 2011 17:51:07 +0000

Canadian banks have been charging fees for ATM use if you don't use their machines.

Tushar @ Everything Finance on Bank of America

Fri, 30 Sep 2011 17:29:42 +0000

So what do you guys think of BofA's announcement of $5 per month Debit Card Fees?

I think its just a matter if time the other banks will follow suit. Right?