Saturday, October 29, 2011
Banks Rethinking Debit Card Fees
On top of all this, even Bank of America is rethinking its strategy. BofA is currently planning to configure more qualifications to help customers become exempt from the fee such as having a BofA credit card, having a minimum monthly deposit or a minimum balance. It seems as if some of the analysts, who earlier said that BofA had done plenty of preparation planning the fee and would not have implemented it if it wasn't profitable, were wrong. Especially in this economy, the public is extremely sensitive to how charges are framed and being imposed a fee for a service they have been using for free for as long as anyone can remember seems greedy and unjust.
Of course, banks have to find additional ways to make money as well. Despite their revenue problems, there have been plenty of checking account offers and credit card offers that seem to pay consumers. As I mentioned in my other post, I was able to get $150 for opening a Chase account (the offer has been since lowered to $125 last time I saw it) and I have seen some offers of $200 for opening a credit card and spending $500 within the first 3 months. Anyone planning on buying a round-trip plane ticket can easily capitalize on this offer and get 50% off their flight.
If you are fiscally responsible, I would highly recommend credit cards over debit cards. For most college students, credit cards may seem too irresistable to treat like cash in which case debit cards are a more convenient alternative. When it comes to the studying the star topic of personal finance, cash and debit cards may be the best solution for young adults. And for those of us worried about banks across the country implementing new fees, we may be able to put aside our fears for a little while longer.