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Debit Card Users Being Charged Monthly Fees

In October, Wells Fargo will begin charging its debit card users a monthly debit card activity fee.


Customers will see the first charge on their November bank statement. Georgia is the only state in the Southeast selected for the pilot program, said spokeswoman Jamie Dexter.


"For our customers, if they use their debit card to make purchases, there will be a $3 a month flat fee charged to their account. So, if you make one purchase or 100, the fee is $3 a month. The marketplace has changed a lot in the last year or so, which is why this is happening. It's something that's really impacting all banks," Dexter said.


It's possible that other banks might begin charging similar fees, in response to the Dodd-Frank Act that became law in July 2010, said David Oliver, a spokesman for the Georgia Bankers Association. The law included an amendment requiring the Federal Reserve to set a fixed minimum rate for each debit card transaction for large banks and card issuers.


Merchants and retailers pay banks and card networks for the ability to process debit and credit card transactions. Now, the cost of debit card payment services has shifted from retailers and merchants to consumers. The Federal Reserve's price cap rule goes into effect on Oct. 1, Oliver said.


"Banks are reacting to replace revenue and recover costs that have been regulated or legislated away from them. Some are choosing to begin including a monthly charge for customers to use their debit card. Right now, this varies greatly by bank and even by account type. As with any product or service, banks will develop a variety of choices and account structures that allow customers to get the most value out of their accounts," Oliver said.


However, Oliver notes that debit cards have not always been free at all banks. When they were first introduced, many banks charged a monthly fee for the card. Debit cards and card usage became popular in the mid 1990s.


At Wells Fargo, there are some ways to avoid the fees, Dexter said. There is no fee to withdraw cash at the bank's ATMs. Or, customers could use a credit card and pay off their balance each month, she said. Also, a few accounts are exempt from the debit card activity fee, such as the Wells Fargo Crown or Crown Classic accounts, so Dexter encourages customers to speak with a banker to discuss their options.


For joint accounts, if a husband and wife both have a debit card, only one $3 fee will be charged per month, Dexter said.


"The fee is per checking account, not per debit card," she said.

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Comments (9) Add comment
hockeymann 08/19/11 - 10:59 pm
Great idea for losing

Great idea for losing business...I will not be paying Wells-Fargo, or any other bank any $3 just for using the debit card. I'll soon be moving what
I have to another bank, and I'm sure one or two will not be fleecing their
customers to use a debit card.

studmuffin1533 08/20/11 - 10:43 am
I moved my personal and

I moved my personal and business account to a credit union on Davis Road.

Little Lamb
Little Lamb 08/20/11 - 10:30 pm
Well, this is a no-brainer.

Well, this is a no-brainer. If you like to use debit cards at grocery stores, restaurants, convenience stores, etc., and your debit card comes from Wells Fargo Bank; then shop around and cancel all your accounts at Wells Fargo and move them to another bank. It could be a local bank, it could be a national bank, or it could (as studmuffin told us) be a credit union. Just move all your banking business from Wells Fargo to somewhere else.

billyjones1949 08/21/11 - 11:08 am
It costs the banks to have

It costs the banks to have these agreements with the credit card companies. They are just trying to recover the revenue lost by the new government regulations. In my business I normally ask the consumer if he or she will be paying by credit card. If they say yes then the card fee is figured in the estimate. If not the estimate is lower. If they then want to pay by card at the end the fee is added back.

Channing 100Proof 08/21/11 - 11:33 am
I'm not a fan of the fee or

I'm not a fan of the fee or their decision to cancel their rewards program.

"Rewards earning to discontinue. Beginning October 8, 2011, debit card purchases and payments will no longer earn rewards points. Any reference to the earning of rewards points in the Program Terms and Conditions will be removed.2 You can continue to earn rewards points on qualified purchases through October 7, 2011, including purchases made on the Earn More Mall® site. If your rewards balance is zero or below after October 7, 2011, your rewards account will be closed."

So Wells Fargo is going to make people pay a fee for using a card to spend their money and then not let them earn points on the purchases. Not cool.

dickworth1 08/22/11 - 01:55 am
Move your account to a bank

Move your account to a bank across the river in SC. Wells Fargo does
not care about its customers, its all about money to them.

Kramer 08/22/11 - 05:09 am
Don't miss the larger issue:

Don't miss the larger issue: the Dodd - Frank Act that has the federal reserve getting a fee from the banks every time the debit card is used. This the fault of that magic time when the house, the senate, and the white house belonged to the democrat party. It will be years going forward as you see what happened than. The awful regulations they passed will take time to filter down. Much worse is coming. Hang one for a rough ride.

Pickett 08/22/11 - 07:05 am
You don't have to move your

You don't have to move your money to SC. Georgia Bank and Trust has a checking account plan that not only refuses to charge you for using your debit card, but will actually pay you back the money other banks charge you for using their ATM. There are some requirements you have to meet (like you have to use your debit card a minimum number of times, use direct-deposit (I think), and other pre-quals that we already practice anyway). It's worth looking into. I'm opening up an account at one of their branches today and will say bye-bye forever to Wells-Fargo and big corporate banks. While I do believe it costs them somewhat to process debit cards, they aren't getting hit as hard as they are indicating. Anyone who owns a business and processes credit cards knows better. This is just a money grab by Wells Fargo under the veil of government regulation.

mtxbass1 08/22/11 - 07:18 am
Kramer, the larger issue here

Kramer, the larger issue here is that banks wanted this fee to be even higher and fought tooth and nail against it being lowered to the rate that goes in to effect on Oct 1. How you can sit here and defend this is incredible. The banks are making nearly pure profit on this as is.

On topic, I will be moving my money to GB&T over this.

Boston93 08/22/11 - 09:53 am
To: Pickett Monday, Aug. 22

To: Pickett Monday, Aug. 22 8:05 There are some requirements you have to meet (like you have to use your debit card a minimum number of times, use direct-deposit (I think).
Right on both accounts. I don't use checking with Wells Fargo, but the bank I use did recently charge me $5.00 service charge for not having a direct deposit program. My Social Security Check has been direct deposit with them for 10 years. Made a visit to the bank and they credited back my service charge. It's not just Wells Fargo. Others that bank at other banks need to check their statements every month. Wake up American's and pay attention.

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