Well, if you are a Wells Fargo accountholder living in Washington, Georgia, Oregon, New Mexico or Nevada then the answer is yes. This upcoming fall on October 14, the banks intends to trot out a new $3 monthly fee that will apply to all debit and ATM cards when used to make purchases regardless of whether “debit” or “credit” is selected at the register. Wells Fargo will be closely monitoring customer response.
"That's why it's a test. Some people understand why we do this but others don't like fees regardless" of the reason, said a spokeswoman for the bank as reported by the Wall Street Journal.
Wells Fargo customers in those five states were alerted to the fee increase by an "important fee change information" letter that the bank distributed via email or along with their monthly statement. ATM only transactions will not be subjected to the fee.
Not The Only One
There are other banks that are testing out similar fees. Regions Bank and Sun Trust bank is experimenting with charging debit card users $4 and $5 fees, respectively. Back in February, J.P. Morgan Chase picked the state of Wisconsin in which to run a trial $3 debit card fee. The Wall Street Journal reported that Bank of America retail banking executive Laurie Readhead announced to investors in May that "pricing for debit cards, that's something that we're talking about potentially testing." A BofA spokeswoman stated more recently that the bank wasn't testing a debit fee at this time, "but we are evaluating pricing across all our payments products."
Say Bye! To Rewards
Wells Fargo and other lenders have already cut reward point programs for debit cards. All of this is being done in response to the projected losses of hundreds of millions of dollars worth of revenue as a result of the Durbin Amendment, which was recently passed. Durbin caps the “swipe” fee at 21 cents that merchants pay banks for every debit card transaction. Thus, banks have been examining all options available to them in order to recoup some of that money and consumers are suffering.
Spokesman for Wells Fargo, Jay Lawrence, says that some accounts are exempt from additional fees, and customers have options available to avoid the fee such as enrolling in direct deposit or else maintaining a minimum balance, reveals to the Atlanta Journal Constitution. Consumers can also get around paying debit fees by using a credit card for purchases instead of debit cards.
More Now Work To Stay 'Free'
CBS News Business and Economics Correspondent Rebecca Jarvis discussed the debit card fee debacle last week on the Today Show, "Some banks are going to tell you that you can avoid paying fees, but there are certain stipulations that come along with that. For example, keeping an average daily balance can be in place to avoid paying fees. Also, limitations on the number of transactions, in some cases you have to go over a certain number of transactions to keep from paying fees and sometimes you have to stay under a certain number of transactions, so read the fine print because sometimes if you're told this is 'no fee,' it comes with limitations," Jarvis said.
She also advised customers to "always negotiate."
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