Bank of America adds monthly fee
Starting next year, the $5 charge will hit most customers who buy things with debit cards.
The Dow Jones news service uncovered the plans after seeing an internal memo sent to bank executives Thursday. It's safe to say that customers will be outraged if the new charges start early next year as planned.
The fee will kick in only during the months when customers use their debit cards to make a purchase, Dow Jones reports. If you use your debit card only at an ATM, you won't get charged.
Check out the following video about hedge funds starting to invest in Bank of America at super-low prices.
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The bank is in bad shape. Its stock has been hammered, it's getting sued left and right, and its credit rating was cut recently. Desperate to shore up cash, it plans to lay off 30,000 workers. B of A shares rose nearly 3% to $6.34 on the news Thursday.
"The economics of offering a debit card have changed," a bank spokeswoman told Reuters.
Perhaps the bank could raise the fees for merchants who accept debit cards? Nope. The Federal Reserve Board said that, starting Oct. 1, the maximum fees merchants will pay is 24 cents per debit transaction. The current average is 44 cents, based on the $38 average debit purchase.
Those new limits will cut Bank of America's annual revenue by $2 billion. So the bank is looking to recoup that money on the customer end of the transaction. It's too bad, because debit cards have become a convenient replacement for checks at stores and restaurants.
Will customers stand for this? I'm going to start using my no-annual-fee credit card more, which gives me points as well. And there's always plain old cash. Customers with certain premium accounts won't get hit with the fee.
And you can be sure that if Bank of America does this, other banks are sure to follow. Most banks are going to feel the pain of the new Federal Reserve transaction limits. Wells Fargo (WFC) will start testing a $3 fee in several states. And JPMorgan Chase (JPM) has begun a similar test in Wisconsin.
Take your money OUT of BoA, move it to a local Credit union or small bank, and let the elite of BoA die off.
I've put up with BofA fees for far too many years as it is, I am changing to a credit union this month as soon as my home loan closes and I dont have to worry about where all my money is for reporting purposes.
Feels like highway robbery to charge me to access my own money, when banks accrue interest gained on the savings I keep as a monthly balance.
BofA: you never gain fans in your customers by nickle and diming us to death. Thanks for the 15 year run as a customer, but unfortunately I am going to a local credit union.
Time to start a grass roots effort to not only help the economy but also show BIG BANKs that consumers do have some clout!!!
Take your money out of the big banks, deposit it in small community banks or credit unions which are more likely to make loans to small businesses who then can hire more employees and perhaps help get our economy back on track.
Bank of UNAmerica paid 4.4 BILLION dollars in bonuses last year to its top executives. Now, they have to lay off 30,000 employees? Why don't they just take the money back from the fat PIGS who didn't deserve it. 4.4 BILLION dollars for ruining a company.
Leave them. THEY ARE CROOKS FULL OF FRAUD. Here is what they did to ME when I closed my accounts. I go to the branch to close my accounts. I had everything consolidated into my checking account. She pulls it up on the screen and says, "OK, I see the consolidation. Oh, there is some interest that is due to be paid on your account (couple of PENNIES) that I will add in. I will be right back with your check."
I get my check and leave. 2 weeks later, I get my monthly statement showing that a $25.00 OVERDRAFT CHARGE had been applied against my line of credit the same NIGHT that I closed my account. The brach rep OVERDREW MY ACCOUNT BY ONE PENNY. The "cents" amount of the check should have been .07 and she wrote the check for .08. This means:
SHE wrote down .08 instead of .07 on the withdrawl slip and CHECKED IT.
She then gave it to the TELLER who ALLOWED the FRAUD to happen when SHE double checked it and created the check.
The MANAGER then verifed and APPROVED it by SIGNING the check and gave it to me.
THREE PEOPLE clearly saw that the amount was wrong and allowed it to happen. The $25.00 was posted to my BOA Credit account as a "cash advance" which means the 29.99% interest rate starts IMMEDIATELY from posting, PLUS the overdraft FEE that was charged to my account.
I REFUSE to accept this as a "mistake" as THREE DIFFERENT PEOPLE looked at the withdrawl slip, looked at the account on the computer screen and verified it.
Bank of CROOKS. Bank of THIEVES. LET THEM FAIL.
$4 billion in bonuses paid out in the spring.
That's almost one billion customer months of service fees that need to be collected just to pay the bonuses.
Better idea, eliminate the bonuses and tell these people they should be happy to have a job right now.
If B of A is hurting now , just wait till the debit card fee goes into effect. They are losing money so the only way they can figure to minimize the loss is to gouge their customers with a fee ?? Without customers the bank will FAIL!!! Guess they didn't factor that into their "business plan"
Time to start looking for another bank.
B of A pushed the debit card business at first. Now they want to charge us!? Time to shop around and find another bank.
Use cash or go to a nonprofit Credit Union. If you are a true capitalist you should reward institutions that are responsible, and punish irresponsible ones.
No more Bush or Obama bucks for BoA
Wow. We use banks for money storage, they turn around and lend it out charging interest, then charge us fees for doing so.
Im to the point of grabbing a coffee can.
this is the final straw...i will be closing all my accounts with BOA! Enough is enough....they keep taking from the little guy to pay the big bonuses and wages to the top of their food chain, who are ulitmately responsible for their debt in the first place. They get rewarded for bad business practices that they should have been fired for, and keep taking from those of us who can't afford to live as it is.
They led us down this path of using our debit cards exclusively, instead of cash and instead of checks, and now they want to charge us for that...I for one am done.
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