- Bargaineering - http://www.bargaineering.com/articles -

Bank of America Cancels Debit Fee, I’m Still Leaving

Posted By Jim On 11/02/2011 @ 7:03 am In Banking | 22 Comments

Bank of America has backed out of its plan [3] to charge a $5 per month debit card fee to its customers. It follows several other banks who have announced new fees only to back off them a short time later.

“We have listened to our customers very closely over the last few weeks and recognize their concern with our proposed debit usage fee,” David Darnell, co-chief operating officer at Bank of America, said in a statement. “As a result, we are not currently charging the fee and will not be moving forward with any additional plans to do so.”

For many customers like me, it’s too late. I’m leaving. I started the process to change my bank [4] a month ago and I’m not stopping – here’s why:

Momentum

I’ve already started adjusting my financial network map [5] to put Ally Bank at its center. All my Bill Pays have been moved over, direct deposits have been changed, credit card payments have been updated, and the only things left are infrequently used things like Treasury Direct account links and how we pay our county water bill.

The hard work of moving accounts has been done and was prompted by a “measly” $5 debit fee. There’s no reason to stop now and certainly no reason to revert back. What will seem kind of funny is that the reasons for doing this aren’t themselves enough to push me to move. It’s the annoyance of a $5 fee that pushed me to move and once I started, I’m not stopping.

Interest Rates

Any online bank [6] will give you a better interest rate on checking, I simply chose Ally Bank because it, at the time, had the higher rates based on a brief look around. Right now, you can get a little under 1% at an online bank for a checking account. A Bank of America, I was getting a big fat zero. It’s not a ton of money, which is why I wouldn’t have switched banks sans the fee, but it’s better to make money than pay it.

As for picking Ally – I could’ve opened a checking account at ING Direct or a dozen other banks between similar rates, a favorable CD termination penalty [7], and online chat functionality; Ally won out.

ATM Access

I opened a Bank of America account because they have branches and ATMs everywhere. Here’s the ironic part about all this, since many online checking accounts offer ATM reimbursement, they have networks even bigger than Bank of America. Ally will reimbursement all ATM fees. That means every ATM is an Ally Bank ATM. When I opened the account nearly a decade ago, online checking wasn’t readily available and the ones that were available certainly didn’t reimburse all ATM access.

Depositing Paper Checks

Finally, with a brick and mortar bank like Bank of America, you have to deposit checks at the branch or a BoA ATM. With Ally, I can scan the check and upload it. If I don’t have a scanner or if the check doesn’t scan right or if I’m simply too lazy, I pop it into an envelope and mail it to them. I do run the risk of the check being lost in the mail, I’ve done it a few times and it hasn’t happened so I’m happy to keep taking that risk (plus I don’t get that many paper checks).

So as you can see, all of the reasons to switch aren’t enough on their own, it wasn’t until I heard about the potential debit card fee that I realized a sea change was coming. Today it’s the debit fee, tomorrow it’ll be something else. They will have to find a new revenue source and most of those come out of our pockets.

(Photo: beglendc [8])


Article printed from Bargaineering: http://www.bargaineering.com/articles

URL to article: http://www.bargaineering.com/articles/bank-america-cancels-debit-fee-leaving.html

URLs in this post:

[1] Tweet: http://twitter.com/share

[2] Email: mailto:?subject=http://www.bargaineering.com/articles/bank-america-cancels-debit-fee-leaving.html

[3] backed out of its plan: http://www.nytimes.com/2011/11/02/business/bank-of-america-drops-plan-for-debit-card-fee.html

[4] change my bank: http://www.bargaineering.com/articles/switch-banks.html

[5] financial network map: http://www.bargaineering.com/articles/financial-network-map.html

[6] online bank: http://www.bargaineering.com/articles/top-5-online-banks-savings-or-checking-accounts.html

[7] favorable CD termination penalty: http://www.bargaineering.com/articles/ally-bank-cd-60-day-early-withdrawal-penalty.html

[8] beglendc: http://www.flickr.com/photos/beglendc/416112064/sizes/s/in/photostream/

Thank you for reading!