Chase opts out of debit-card fee
This post has been corrected. See below for details.
Another bank seems to have figured out what Bank of America Corp. has found out: charging for use of debit cards could chase customers away.
JPMorgan Chase & Co., which for eight months has been dinging its Georgia and northern Wisconsin customers $3 a month for using debit cards, said Friday it has decided to end the test next month and won't impose the fee anywhere.
There was no official announcement, but a person who had been briefed on the matter said the bank's customers preferred a program it calls Chase Total Checking.
That's a package that charges checking customers $12 a month ($10 monthly in California, Oregon and Washington) but waives the fee if they have at least $500 direct-deposited each month, or keep at least $1,500 in the account, or have a total of $5,000 in linked Chase accounts.
A host of critics including President Obama have attacked BofA's plan to start charging account holders $5 a month if they use their debit cards to make purchases (ATM transactions are free).
Citibank has said its customers really hate the idea of debit card fees. It has raised its fee for a basic checking account but has said it won't impose a debit fee.
US Bank also has said it has no plans for such a fee, although Wells Fargo has begun conducting its own tests of a $3 monthly charge and some regional banks like SunTrust, a big presence in the Southeast, have started charging a fee similar to BofA's.
Bank customers across the country have expressed "outrage" over the BofA fee, according to Norma Garcia, who heads up a financial-services program for Consumers Union, the advocacy arm of Consumer Reports.
"It's time for Bank of America to listen to its customers who are saying loud and clear: drop the fee or we'll drop you," Garcia said in a statement. "All banks that are considering debit card fees should ditch those plans."
BofA Chief Executive Brian T. Moynihan said this week that he’s “incensed” by public criticism of his company and is pushing back by reminding local leaders of its contributions to their economies.
[For the Record, 1:44 p.m. Oct. 28: An earlier version of this post indicated that Citibank had tested debit card fees. Citibank did not impose a debit card fee on a test basis, but it surveyed its customers, who opposed the idea of fees.]
--E. Scott Reckard
Photo credit: Elaine Thompson / Associated Press