BofA's New $5 Debit Card Fee? Blame Dodd-FrankHalah Touryalai, Forbes Staff
Sep. 30, 2011
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The inevitable happened today. Bank of America said it will start charging customers a $5 monthly fee on debit card purchases.
Where’s this coming from? Well, anyone paying attention to the Durbin Amendment (which came out of the Dodd-Frank Act) as it was moving through Congress would have seen this fee coming. The Durbin Amendment essentially limits the amount of money banks collect from merchants, like Target for instance, each time you use your debit card there.
Back in June I said that that while placing a cap on those debit card fees might be great news for retailers it would be bad news for customers. Why? Because now that the Durbin Amendment goes into effect October 1 banks will have less money coming into their pockets from the retailers. Where do you think they are going to make up for that lost revenue? You got it–me and you.