Thursday, September 29, 2011

Bank of America to Add $5 Fee to Debit Card Users

Recently, Bank of America has announced that they are adding a $5 fee to those who use their debit card for purchases. Other banks have stated that they will be adding a debit card fee similar, but this particular announcement has more impact because BOA is the largest U.S. bank by deposits. Debit card usage has started to rise in recent years, 2/3 of customers saying that they use debit cards more than credit. The company hopes this will give customers incentive to switch to more frequent credit card usage. Many will have to consider a trade-off between dealing with the $5 fee with all debit usage, or dealing with interest fees on credit card bills, along with the possibility of credit card debt. This also becomes an issue for many families with teenagers, whose parents give them a debit card as an easy way to pay for gas and other consumer goods, without another credit card bill at the end of the month. 66% of customers have said that if a $5 fee is implimented, they will find another way to pay.

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