Monday, August 22, 2011
Wells Fargo tries debit card fee
Wells Fargo Bank N.A. confirmed to The Green Sheet it is testing debit card fees charged to customers' business and personal checking accounts. The trial will be held in five states beginning Oct. 14, 2011. According to Wells Fargo Assistant Vice President Lisa Westermann, the fee will allow customers to continue to receive such services as zero liability fraud protection, fraud monitoring, My Spending Report and card personalization from the bank's Card Design Studio.
"Wells Fargo plans to test a debit card activity fee of $3 a month when a customer makes a purchase or payment, including a recurring payment, with his or her personal or business debit card, check card or ATM card linked to their Wells Fargo business or personal checking account opened in Oregon, New Mexico, Nevada, Georgia and Washington," Westermann said.
She added that Wells Fargo is notifying customers of the fee through monthly checking statements, ATM messages, email and statement inserts. She noted there are some fee exemptions and customers should check with their local bank branches to see if they qualify.
Durbin Amendment's effect
The cut in debit card transaction fees mandated in the Durbin Amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 appears to be behind Wells Fargo's decision to try charging consumers for making payments with debit, check or ATM cards. Under the amendment, transactions fees dropped from an average of 44 cents to an average of just over 21 cents following the June 2011 release of the final Federal Reserve Board rule on debit transaction fees.
"In WFC's earnings announcement we talked about recovering 50 percent of the lost revenue over time through product changes and volume growth," Westermann said. "This is one of those ways we are looking at recouping lost revenue. We regularly review our pricing and take into account the needs of our customers, industry trends, the market competition and our cost of doing business. Our goal is to set a fair price that is consistent with the value of each product or service."
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