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B of A debit fee no surprise post-interchange Cheney
WASHINGTON (10/3/11)--The higher debit card fees planned by Bank of America and other large banks are “no surprise,” but consumers can avoid these and other potential fees that may follow this past weekend’s implementation of the debit interchange fee cap by joining a credit union, Credit Union National Association (CUNA) President/CEO Bill Cheney said. The debit interchange fee cap regulations, which became effective on Saturday, limit debit interchange fees for issuers with assets of $10 billion or more to 21 cents, and allow an additional five basis points per transaction to be charged to cover fraud losses. An extra penny may be charged by financial institutions that are in compliance with established fraud prevention standards. Most credit unions are exempt from the fee cap. “Consumers should give credit unions a close look and take advantage of credit unions’ emphasis on service to members over profits, typically with no or lower fees overall,” Cheney added. Potential credit union members can learn about credit unions nonprofit structure, the credit union system, and where their nearest credit union is located at aSmarterChoice.org, he added. The CUNA CEO said at least 80% of credit unions surveyed by CUNA provide at least one free checking account with no minimum balance requirement and no maintenance or activity fees. The Los Angeles Times and the New York Times are two media outlets that are focusing on consumer dissatisfaction with Bank of America’s announcement that it will charge $5 per month to many debit card accountholders. A story in the Los Angeles Times focused on University of Southern California medical school employee Guadalupe Garcia, whose dissatisfaction with Bank of America led her to an on-campus credit union. Garcia said she felt a “social responsibility” to leave BofA after its debit card policy change, which will impact many of the bank’s lower-income customers, was announced last week. The New York Times told a story of small business owner Patrick Shields, who left Citibank after he “realized he could do better at a credit union.” Shields told the Times that the credit union opened his business and personal checking accounts “free of charges, which Citi could not and would not do.”
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