If these machines weren’t adding to the banks’ bottom lines, they never would have been put in. Think how many less tellers, how many less branch locations, there are, because the ATMs pick up the slack. This saves the banks huge money.</p>
<p>It used to be that banks made their money by, well, banking. You could get free checking because the bank paid you zero interest, and lent your money out. Things like overdraft charges and bounced check fees were meant to cover their costs rather than to punish and profit from your customer’s mistakes.</p>
<p>And it too shall likely pass. Remember the outrage when some banks first started charging fees for ATM withdrawals? It changed the way I use ATMs, and the same will happen with debit cards.</p>
<p>If you don’t like it, vote with your feet. It’s a large hassle to move, which I think the banks count on, but there’s no way I will ever pay $20/month for a checking account or $5 to use a debit card, unless there are no other choices.</p>
<p>Very interesting…we have gotten NOTHING like this in the mail…and no indication that this is happening as of Oct 16 either.</p>
<p>Does this mean that my son who has directo deposit at work will not hav to pay this fee?</p>
<p>Will my daughter who has NO access to her B of A debit card (it’s locked in a safe) be exempt from this charge also?</p>
<p>It would be VERY nice if B of A could explain this to their customers a little better.</p>
<p>
</p>
<p>What letter? I’m the POA (and B of A has it on file) for my daughter and I’ve received NOTHING in the mail from them about this…NOTHING. I asked at the bank branch.</p>
<p>Also B of A is not regulated by the banking commission in YOUR state or anyone’s for that matter. When I had fraud issues and wanted to file a complaint (which was well founded by the way) I called our state banking commission and was told they have NO JURISDITION over B of A because it’s a national bank. I was told to file a complaint with B of A…like that would have done ANY good.</p>
<p>Bank fees have generally been going up for various reasons:</p>
<ol>
<li><p>Less competition.</p></li>
<li><p>Very low interest rates – it used to be that large interest rate spreads allowed banks to profit off of accounts without any fee income. Now, the interest rates and spreads are nonexistent, so the spread no longer pays for the servicing costs while making a profit. So the small customer who averages only $100 in the account but never pays any fees is no longer a profitable and desirable customer for the bank.</p></li>
</ol>
<p>LasMa, you may be right. I have been searching for the 2nd letter BofA sent with the new cards. I am going to my local BofA branch tomorrow …. hopefully someone there can explain the fees. I may drop the savings acct and just keep the debit/checking acct.</p>
<p>floridadad, just one clarification about the ATM machines: Yes, they cost money to build and maintain, and yes, I remember when you had to go to the bank by 3PM on a workday to access your funds. However, please note that BoA is NOT imposing a fee for its customers to use its own ATMs! The $5 fee involves only point-of-purchase transactions: using your debit card at a merchant in lieu of cash or credit card. It has NOTHING to do with ATMs.</p>
<p>^^ YET!! B of A has already said that more fees are coming. We just don’t know what they are.</p>
<p>floridadad, if you’re a B of A customer, you’ll remember that several years ago, when you went into a branch, there was someone whose full-time job it was to talk to customers standing in line for a teller, and push them toward the ATM. Yes, it costs a little bit to maintain the ATM. It costs MUCH more to hire human beings. ATMs are a huge money-saver for banks.</p>
<p>Well, to merge two items in this thread, my personal account is with BofA. I didn’t mean for that to happen - in fact, I deliberately opened that account in 1969 in a small local bank because I admired the bank owner. A few years later, that bank was bought out by a somewhat larger regional bank. 10 or 15 years later, that bank was bought out by a pretty big statewide bank. 10 or 15 years later that bank was bought out by BofA.</p>
<p>But you know what? That small local bank that I started out with promised “free checking for life.” And I’m still alive. That contract provision has been binding on each bank which bought the previous bank (although I had to fight for it once.)</p>
<p>One thing that is not clear from the news articles is whether it applies to signature transactions (“credit” mode) or PIN transactions (“debit” mode) or either, when made with the debit card in question. These days, most debit cards (and most credit cards) can be used for either type of transaction; the different type of transactions have different costs and benefits to the card holder, merchant, and bank.</p>
<p>Yes, but that small local bank probably did not promise you free ATM transactions or a free debit card for life, ATM’s not having yet been invented in 1969 … so I think B/A is free to tack on that $5/month debit use fee if they feel like it. ;)</p>
<p>Again, I think the whole thing is a tempest in a teapot. The reason B/A is around to swallow up all of those smaller banks is that they have made profitable decisions over the years. Things change, times are tough, interest rates have plummeted and the feds have limited the fee that can be charged to merchants for debit card transactions… so various banks have decided to impose a fee for a service they offer that costs them more money to administer than the fees they can generate. Back in 1969 you could open an checking account somewhere and have the bank give you a free toaster – I haven’t seen that in years and no one railing against the banks for ceasing the practice of giving away small household appliances. </p>
<p>Meanwhile I can pull up my bank account on my cell phone while stranded at an airport 2000 miles from home, and transfer money from one account to another, pay bills use my debit card to buy a meal or get cash out of an ATM conveniently located at the airport… Back in 1969 the banks closed at 3pm, the only way to get cash outside of going to the bank was to rely on the good graces of some merchant to cash a check for you (out of town? good luck with that) – and they used to put holds on funds of up to 20 days when checks were deposited. And most of the credit cards you could get in those days came with an annual fee. </p>
<p>On the other hand, broadcast t.v. was free.</p>
<p>I agree. For $60 per year you will get a free card to partake in unlimited money transactions, including auto deposits, auto-pay, bill-pay, transfers, etc via online banking, access to your money 24/7 at locations all around the world, etc. I don’t really understand why people expect to get all this service for free, especially if they are lower-income depositors, whose cash goes in and out constantly every month, leaving very little to nothing for the bank to invest and earn $ on. From what I understand, individual customers with small accounts never made money for the banks anyway, and were essentially considered a community service. Consider yourself lucky to have received all this service for free in the past.</p>
Actually, it is razorsharp who is “completely and absolutely wrong” about this. I ended up fielding a case involving some of the go-go mortgage lenders of the recent era and got an eye full of what went on. It had absolutely nothing to do with government regulations “forcing” commercial banks to loan to “deadbeats” - in fact, a lot of what caused the problem bypassed commercial banks altogether. Many of the loans were refis; others were made to speculators eager to flip houses and make a killing. </p>
<p>There were a variety of ways the bad loans entered the pipeline, but one of the major routes was this: a mortgage lender was a extended line of credit by a bank. The mortgage lender then issued loans funded from that line of credit. They then bundled those loans, marked them up, and sold them off, either as a group of individual loans or as an integrated portfolio, which was “securitized” and various interests in the portfolio sold as securities by Wall Street investment houses. Everybody made a profit off of every loan - the line of credit bank, the mortgage lender, the investment banks which sold the securities. None of them were “forced” to loan to anyone. Most of the problem loans were created entirely outside of any meaningful government regulation at all. (In California, and some other states, mortgage lenders are only loosely regulated, here, by the state Department of Real Estate, which is basically just a professional licensing bureau.) The only motivation for making the loans was the fact that each person involved in the process - from the mortgage lender in the community, to the various financial institutions buying and selling the loans, was making a profit off of each loan, none of them thought they’d be held responsible for any losses, and nobody was regulating what they were doing.</p>
<p>Government regulation causing the housing meltdown is a myth. Lack of government regulation was the actual cause. Interesting how people can become absolutely convinced that night is day, eh?</p>
<p>I suppose everyone has a B of A story. Here’s mine …</p>
<p>My D was sent one of those “guaranteed acceptance” student credit card offers. We take the offer to the local B of A branch and fill out the necessary paperwork. Two weeks later DD gets a letter: “Application Denied.” We go back to the local branch. They say "Just open a Savings Account, deposit $XXX as security and the credit card will be approved. And it was, with a $300 limit as I recall. (Try buying textbooks with that limit. But I digress.) A few months go by and a $3/month “Inactivity Fee” starts appearing on the Savings Account Statement. Return to the local B of A branch. “Nothing we can do.” Goodbye B of A.</p>
<p>Bay, I am pleased and honored to announce that a $1,000,000 line-of-credit has been made available to you at zero interest (i.e., interest free). The only condition of this “free” account is that you never access the money. Each dollar you do choose to access will incur a $5/month fee.</p>
<p>(Yes, I do realize you were being facetious. But casual readers might not know that.)</p>
<p>When I worked at BofA, the cost in 2007 for teller transactions was $2.45, for ATM is ws $.34 and bill pay was $.02. It is much cheaper to use ATM and debit transactions were even less than ATM based on the maintenance.</p>
<p>It’s pretty obvious that this move was meant to push small time depositors away from BoA. They’re losing money servicing these small accounts and they can’t afford to eat that loss anymore, by closing your account your helping their bottom line just as much as if you paid the fees.</p>
That contract provision has been binding on each bank which bought the previous bank (although I had to fight for it once.)</p>