Decline in debit and credit card charges forces banks to hike up their fees
Now consumers must gear up to shell out extra fees if they don’t make a considerable sum towards direct deposits on their checking accounts every month, if they don’t maintain sufficient balance, and if they have an outstanding loan. Now, there is a boost in charges on financial stocks as the limits on debit card and credit card fees roll out.
From the 24th of May Bank of America will increase its monthly fee on one of its most popular checking accounts. It would go up from $8.95 to $12. Customers would be charged $35 as fees if they overdraw on their accounts by less than $10 and the basic checking account would be replaced with an account which comes with a monthly fee which can’t be avoided.
JP Morgan Chase has already hiked up its fees for most of its customers and they are now charged $10 to $12 per month on their regular checking accounts. Only customers that maintain a minimum daily balance of $1,500 and those who set up direct deposits of $500 or more every month into their accounts would be able to avoid the fee.
In the meantime, Wells Fargo & Company is going to discontinue Wachovia’s free checking accounts for its new customers. The larger national banks are now doing everything in their capacity to boost the loss in revenue as well as profits due to the recession as well as the Credit Card Act. Many consumers were left in severe financial crisis due to the recession and according to the new law there are caps on the amount of fees that banks can charge customers and retailers who use their debit and credit cards. Now, the banks are using the decision made by the Fed Reserve recently to put a cap on the amount that banks could charge retailers which is 12 cents from 44 cents per transaction, as an excuse to hike up the fees and to cut down on the rewards programs on debit cards.
However, banks must not assume that the American citizens will simply accept these additional charges. There are many Americans who think that the financial meltdown was caused due to these multinational banks and are yet to overcome the taxpayer bailout that helped revive these banks, so they could begin making profits again. But now, banks are hiking up all the charges in order to earn more revenue.
