Vote with your feet. If you don't like the BofA fee find another bank or credit union that doesn't charge fees for debit cards.

The free market at work. As Roger says, anyone who objects to the fee is free to move their account elsewhere.

Anyway: anyone who has the option should have their accounts at a good credit union.

I certainly think voting with your feet is the appropriate answer for now. And BofA lost my business ages ago. But, I believe the real scare is that, like the airlines, the banks will say that if BofA can get away with it, then they, too, will add the fees, and very soon, there won't be a bank anywhere that doesn't charge debit card fees.

If I am not mistaken, those who meet minimum standards (direct deposit, minimum balance, etc.) do not have to pay the fees, anyway. And one **could** actually whip out the ole checkbook and use that! (though I would think the bank would hate that as a much more expensive choice) There are options!

That said, I believe the real problem here is that most consumers believe BofA and other banks like them should be down-on-their-knees humble and grateful that they got bailed out, instead of having their doors padlocked (and employees sent home).

I'll admit, that, libertarian though I am, since I was forced to contribute my tax dollars to these banks, a little appreciation (and fewer fees) would seem to be in order.

My biggest objection by far to this fee is that it's double-dipping. Banks should, in theory, be making interest money by loaning out what's deposited in their accounts. They make lots of money kicking the little consumers, too, in the form of overdraft fees, ATM fees, monthly X fees if you go under Y dollars, and so on. And of course up until now they've been making money hand over fist by charging retailers. It's really mind-boggling that with all these shady practices they "needed" a bailout from the taxpayers.

My other objection to this is that once someone has banked at a place for a while, it becomes very difficult to move. The bank sure doesn't make it easy at all to close accounts, either. You have to make sure direct deposits are moved, automatic bill payments are updated, cards are canceled, all current charges have gone through so nothing bounces, and so on. It took me a good month to get everything switched over when I dropped BOA. I'm fairly sure this is why BOA still even has customers at all.

Of course, I moved my money out of BOA ages ago. They care nothing about their customers except what they can milk from them. They can die in a fire. The new debit card fee is just icing on the cake during a time when consumers are already really pissed off at them.

Part of the problem is the banks were able to pass the cost of ATM card transactions to the retailer for so long that the entitlement attitude kicked in. Face it, some people are just too ignorant to understand who really pays for that "free" stuff.

Another part of it that the banks would rather you use credit card for purchases. They are much more profitable.

Part of the problem is that the government was forcing them to loan money to people who weren't going to pay it back, so they had to come up with something else to stay afloat.

Essentially, Dodd-Frank is telling the banks "No, you have to go bankrupt to serve our socialist needs."

Just like Obama says: at some point you've made enough money.

@parabarbarian -

They are also more secure. Part of that cost is to cover regulatory requirements for dealing with fraud, etc.

If your bank account gets drained by a stolen debit card with the PIN, you might get your money back, eventually. If it's through a credit card transaction however, you get your money back now.

Just out of curiosity Amy, why is debit okay for Costco but not anywhere else? Are their payment systems more secure?

In the meantime, thought you would enjoy the below bit of deja vu.

http://blogs.ocweekly.com/navelgazing/2011/10/mcdonalds_scalding_hot_coffee.php

I worked in banking for several years and learned on incontrovertible truth. Banking is a strange industry.

You, the consumer, put your money into an account. Since it's your money, you regard your accounts as your own and not the bank's. So you resent it when the bank charges you a use fee for access to your money.

But the bank is the one bearing the expense of maintaining branches and ATMs, clearing checks, and maintaining an electronic network for automatic bill pay, direct deposit, and debit card based transactions.

In addition, the bank is left on the hook for your unresolved overdrafts, foreclosed property, defaulted credit cards, and unpaid consumer loan balances.

Low balance demand deposit (checking) accounts often end up costing banks more than they provide in revenue.

Still ... it's your money. Where do the banks get off charging you to use your money?

BoA does the credit card processing for my biz & I just got a letter that my processing fees are going UP -- only .25% but still found that pretty odd.

Suntrust is going to charge me and my minor daughter (our accounts are necessarily connected) $15/month EACH for access to our money. It comes to a large percentage of my daughter's very part time job. Of course the bank can charge whatever it chooses, even though it was too weak-kneed to fight the ridiculous legislation in the first place, just as I am free to move my accounts to a community bank.

Credit union, credit union, credit union.

These days everyone can can find a credit union to join. I am amazed that anyone uses anything other than a credit union (or a customer friendly local bank.)

We left B of A 8 years ago, and wellsfargo 3 months ago. We're with USAA now and happy thus far. I'm so sick of the "people can't handle this themselves" mindset. I'm losing all hope.

The BofA debit card fee is a direct unintended consequence of the Frank-Dodd legislation’s attempt to rein in immoral unethical banking practices. Guess what… bankers are still immoral and unethical.

No, Roger. Politicians are immoral and unethical.

Bankers are just trying to make a buck.

When the politicians tell the bankers that they have to do politically-motivated but financially-unwise things, it interferes with that "make a buck" thing, so they have to get creative to keep themselves in business.

And that's how little CDOs get made.

I've been with a credit union for years now. I've gotten a line of credit and credit card through the same credit union. The fees are lower (including no charge to access my own money), free to transfer money between accounts (WaMu, then Chase) would charge me if I "overdrafted" my checking account and they would pull money from my plentiful savings and charge me $30 to move the money. Transferring money became a hassle and I found that Chase would hold checks/debits until my balance was low to cash them regularly. (How often can 8 transactions come in on the one day before pay day?). I voted with my feet long ago and have never considered looking back.

Changing banks was a bit of a pain, but it has saved me tons of money.

We're with USAA now and happy thus far.

USAA's banking services are great. I highly recommend. I don't think that banking and financial services has the same restricted availability as their insurance (also great). As long as you don't mind having no local branches (most places), they are a great option. Credit Unions are also a good choice.

Durbin's amendment probably shifts the fees around without saving or costing anyone much money. Merchants will pay less on debit card transactions and market prices will probably adjust downward to erase those savings. Individuals will explicitly pay more to the banks. The pain is in seeing the costs rather than having them hidden in the price of goods.

I'm against the Durbin amendment anyway, because it adds more complications to the law, which should be made simpler and less regulatory.

The more fundamental injustice is that credit and debit card agreements require that the merchant not give a discount for cash. Merchants agree to charge the same "low" price (as cleverly advertised) "on credit card puchases as on cash purchases".

Say a bank card agreement required the merchant to withhold discounts when using AnotherBank's credit card. That would be illegal as restraint of trade. But, there is no one defending the use of cash. The better rule would be to allow merchants to give a discount based on payment method. This would expose the costs of using credit and debit cards, allowing consumers to collect any avings for using cash.

It hasn't been worth the trouble to move from Bank of America yet, for me.

This fee changes nothing, because we refused the "free" debit card. I've got a debit card at the credit union, and more than enough credit cards.

When and if they annoy me sufficiently, I'll redirect all the automated payments and the direct deposit. Until then, I'll stay put.

I'm a customer because Syracuse Savings Bank was eaten by Norstar which was devoured by Fleet which was gobbled up by BoA. Service has gotten progressively worse with every change.

Merchants will pay less on debit card transactions and market prices will probably adjust downward to erase those savings.

According to a news blurb I read, a similar law passed a while ago in Australia has so far not resulted in a reduction of prices.

All the Dubin Amendment did was increase costs for consumers.

The Law of Unintended Consquences strikes again.

Yet again, congress oversteps It's mandate. I guess barney frank just can't Fuck up the economy fast enough. Anybody who thinks the mortgage crisis was not easy traced back to our worthless congress is a complete moron

More on major retailers lobbying for the Durbin Amendment and not passing the savings on to consumers.

http://www.nationalreview.com/articles/279198/why-your-bank-charging-more-fees-john-berlau

"Where do the banks get off charging you to use your money?"

Well, not to be rude, but when did you decide you weren't actually getting a service?

You went to them with your money.

You don't, and didn't, have to.

All please look around for Clark Howard and Dave Ramsey. Those guys can set you straight.

Pittsburgh - Dollar Bank. Love them.

Today someone at Dollar Bank took the time to go over their check deposit/ fund availability policy with me, down to the minute, day, and method of deposit.

Tomorrow I have an appointment at a local branch, with a staff person, to review their online banking system. And the guy waived my overdraft fee. This is why I stay with this bank - they are great with me. The people in charge allow their staff to be great with me.

I make, and have, very little money - so this isn't just the @ss kissing of the affluent that happens at one of our large local banks.

Also great with me? My credit union.

I do not understand why B of A still has customers.

Well, not to be rude, but when did you decide you weren't actually getting a service? - Radwaste

I was facetiously voicing the customer.

As I said in my post, banking is a strange industry. It's a counter-intuitive retail industry.

My coworkers and I had many a discussion on how customers regard banks ... and how banks regard customers.

Many customers do not, in fact, feel that they are getting a service from banks. Many don't understand why there are fees. "Just hold my money 'til I need it. Why am I payin' you for that?"

Many customers do not, in fact, feel that they are getting a service from banks. Many don't understand why there are fees. "Just hold my money 'til I need it. Why am I payin' you for that?"

I wonder if these same people get upset at the U-Store-It place when they get charged for access to the stuff they've got stored there, too...

"I wonder if these same people get upset at the U-Store-It place when they get charged for access to the stuff they've got stored there, too..."

Not really a good analogy, though. You don't give U-Store-It the right to loan your stuff out to other people and charge for it.

I think this is what's really got people going: a lot of banking services used to be supported by the bank's interest income. The banks found it worked in their favor to encourage deposits so they could make more money on loans, and so many services to depositors were free, and a lot of depositors even earned some interest on their deposits.

Nowdays, though, loan-making is so tied in knots by regulation (and the fact that in the current economy, not many people are borrowing), that they can't make any money off of lending. So banks are devolving into what Not Sure described -- money warehouses. Hence the fees; it's no longer to the bank's advantages to attract deposits, since that just makes their FDIC premiums go up. In fact, the up-and-coming trend in banking seems to be "non-bank banks" -- lending institutions that only accept deposits from a privately organized group of depositors. Such have a lot more flexibility in lending, since they don't accept deposits from the general public. This is a bad trend, since the services of non-bank banks will generally only be available to wealthy and elite depositors.

Having said all that: The magic word is "credit union" (or maybe community bank). We do all of our banking with a credit union -- checking, savings, credit cards, and our home mortgage. We pay not a dime in fees for any of this. Our savings accounts even earn a bit of interest, and we can earn somewhat more with short term CD's. And we can manage it all online. Make the move now. You know you want to.

I used to work in the banking industry and as my name implies. I did not see the raw data but what I did see backed up an assertion by a co-worker that the actual cost to process a swipe should be around 2-3 cents. The should is that they have a reasonable network setup and not paying anyone else any silly fees. So the rates they are charge are completely out of line.

A plastic card is basically needed these days. The only places that take paper checks are grocery stories and banks and the utility company (but only if you mail it, and cash is only at the main office...the others have automated card readers - found that out the hard way).

Since I working quite far from my credit union I am looking at joining a local one. Unfortunately a lot of them appear to be pretty bad. One co-worker advised me that one doesn't do well online - if you check your balance online it might be up to 5 business days out of sync, transfers may take up to 5 business days. And they aren't that cheap. The good ones are just too small...one branch and one offsite atm, looks like I would have to use other's atms and pay the fee.

I wonder if these same people get upset at the U-Store-It place when they get charged for access to the stuff they've got stored there, too...

The U-Store-It place doesn't use your stuff stored there to make money unlike a bank. Not say banks should get nothing...

I'm probably going to sound contrarian on this, but I would rather have the $5 fee to have unlimited debit transactions than have no fee and be limited to $50-$100 a transaction.

Most of the banking I do with BofA is with Online Bill Pay and ATM's. I moved to them from a local bank five years ago - where I used a lot of foreign ATMs and paid $60-$70 a MONTH in ATM fees. (Comparing $60 to $720-$840 The staff there was disjointed and the hours were horrible.

If BofA decides to begin charging ATM fees at their own ATM's, I will return to the local bank, as I still have the old account (and their billpay feature is very good), or take up the offer on USAA. Wait and see, I guess.

Oops...

That should read (Comparing $60 a year to $720-$840 a year in ATM fees alone? No contest there!)

I also predict that BofA will say, "well, never mind, we won't charge the fee after all" simply because of the massive negative publicity it generated, or perhaps alter it more in favor of the consumer (e.g. if you have the Keep the Change feature, any KTC transfers to your savings account will be reduce the $5 fee, and anything over $5 will waive the fee entirely for that month - e.g. if you have $4.65 in KTC for that month, you pay 35 cents; if you have $5.19, you pay no fees - in either case, you still keep whatever you've accumulated).

I'm old enough to remember when ATMs were introduced (during the 1970's). When they were, the transaction was free. Why? Because, at the time, the justification for installing the expensive machines was that, over time, banks would save money be reducing the number of tellers they needed on staff. Of course, they figured out pretty quick that they could cut tellers AND charge for ATM use.

When in doubt, follow the money.

> I'm probably going to sound contrarian on this,
> but I would rather have the $5 fee to have
> unlimited debit transactions [...]

Or even better: To pay a reasonable fee for their processing AND INSURANCE of my holdings, with their promise NOT to sell my information to others, or make it recklessly available to the government.

The knowledge that they're charging me to build a product they can sell is disturbing.

That said...

I agree with Amy. Like health insurers, these guys imagine themselves to be (and compensate themselves as if they were) the most dynamic business leaders who've ever lived.

But in fact, they're the most extensively regulated men who've ever lived. If they stop giving away toasters with new savings accounts, the Senate convenes a hearing.

The problem with 'voting with your feet' is that even if BofA were to get in financial trouble again from some huge loss of customers, the feds would bail them out AGAIN with OUR money.

Banks made a LOT of money on fees and interest (with OUR money). And then interest rates fell. But fees didn't. Then fees fell. So banks make less money. They're still making money, just not as much. How sad.

I wonder if these same people get upset at the U-Store-It place when they get charged for access to the stuff they've got stored there, too...

Two differences between self-storage facilities and banks that affect people's perceptions of the utility of each:

1. The U-Store-It place rents space. You can see your storage shed, visit it, and see a tangible trade-off (space for dollars). You don't pay for access to the storage space, you pay for the apace itself.

2. You don't use your skis or used auto parts on a daily basis. You rent the U-Store-It with the expectation that you be storing non-essential and non-daily use stuff there. You expect to have to plan ahead and make an effort to get your stuff. Your money parked at the bank, however, you want instant access to, instant use of ... any place ... any time.

I lurvs my credit union.

I just closed a Chase checking account yesterday. I got a premier checking account for "free" with my mortgage thru Chase and now that I've paid off the mortgage (yay!), they wanted me to pay $25 /month for the checking account. Or deposit $15K with them to keep it free.

I use Columbia Credit Union and I use them for all my banking needs. Checking account is free with direct deposit. Money market account is free if I keep $1500 minimum balance on hand. Transfers between accounts are a mouse click away.

They don't play games, they have great service, their online tools are up to date and easy to use. I have never had a problem with them in like 10 years.

One can use a normal credit card on Costco's website to purchase gift cards (Cash Cards, they call them) which you then use at the register in the normal manner.

It’s a way for those of us who prefer to use credit cards for whatever reason (ease of tracking expenditures, collection of miles/points etc.) to get round Costco’s no-credit-cards-except-our-co-branded-ones policy.