Behind Bank of America’s decision to charge debit card fee

Here and Now

Story from Here and Now. Listen to audio above for full report.

Bank of America announced Thursday that starting next year, it will begin charging a $5 monthly fee for customers who use their debit cards. And customers are already taking out their frustration.

On Twitter, Peter Skeritt wrote “Well. looks like I’ll be closing my Bank of America account before the year is out. Fees mean more revenue only if you have customers.”

Bank of America spokeswoman Anne Pace defended BOA’s move, saying that “the economics of offering a debit card have changed.”

The announcement comes days before a provision of the Dodd-Frank financial overhaul bill called the “Durbin Amendment” takes effect. That rule limits the fees that banks can charge merchants every time a customer uses a debit card for a purchase. And The New York Times reports that Javelin Strategy and Research estimates the new rule would reduce revenue for banks by about $6.6 billion a year.

The Bank of America website’s homepage crashed today, but it’s not known whether the technical issue was related to the bank’s announcement.

Read more on the Here and Now website.

———————————————-

Here and Now” is an essential midday news magazine for those who want the latest news and expanded conversation on today’s hot-button topics.

Invest in independent global news

The World is an independent newsroom. We’re not funded by billionaires; instead, we rely on readers and listeners like you. As a listener, you’re a crucial part of our team and our global community. Your support is vital to running our nonprofit newsroom, and we can’t do this work without you. Will you support The World with a gift today? Donations made between now and Dec. 31 will be matched 1:1. Thanks for investing in our work!