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Wells Fargo: $3 Monthly Debit Card Fee

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Wells FargoIt was only a matter of time before we’d see the effects of the watered down Durbin Amendment. The Durbin Amendment originally capped debit card fees at 12 cents but after some wrangling, the Federal Reserve ultimately capped the rate to 21 to 24 cents, nearly double what was proposed last December. That fee cap was set in late June but won’t take effect until October 1st.

Wells Fargo is the latest bank to make moves to limit the damage of losing this revenue source. Starting October 14th, customers in Georgia, New Mexico, Nevada and Oregon will have to pay a $3 monthly fee for their debit card. What was once something a bank required in order to take advantage of promotions (to get the account stickier), is now something they’ve turned to in order to make more money.

I rarely use my debit card but I’d cancel it in a heartbeat if there was a fee. How about you?

(Photo: moneyblognewz)

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33 Responses to “Wells Fargo: $3 Monthly Debit Card Fee”

  1. Matt K says:

    I’d take my account to a bank who didn’t charge a fee without hesitation. never paid to have a checking account, and don’t plan on it.

  2. Walt says:

    No way would I cancel my debit card…I’d just switch banks.

    • Jim says:

      You’d go as far as to switch banks over a $3 fee?

      • John L says:

        I sure would and already have. It’s not like this is the only fee they charge. Credit Unions FTW.

      • Walt says:

        I actually would, yes. And it sounds like everyone here would also.

        • Brendan says:

          When you add on a fee for the rewards checking ($12), and the fact that they don’t reimburse any non-WF ATM withdrawals…then yes, I would (actually, I am going to) switch banks. I’ll leave my WF open, but my direct deposit paycheck, mortgage, and utility bills are going to be taken elsewhere.

          While it is just $3 now, this is a) the straw that finally broke the camels back for me, and b) most likely not the end of tacking on fees.

          Not to mention, the WF (ex-Wachovia) branches in the DC area suckkkkkkk! Old, small, and poor customer service.

          When I lived in San Diego, WF was the way to go for me. On the East coast, not so much…

      • Scarlet says:

        Yes. In fact I’m in the process of doing it right now. With two debit cards off of one account, it adds up to $72/year and I don’t go around throwing my money away. I’m surprised that you do.

  3. NoNonsenseNick says:

    I agree…I would be switching banks in the blink of an eye if I was getting charged any kind of maintenance fee!!!

  4. Kurt says:

    Agreed, I would cancel my Debit Card in a heartbeat.

  5. Brendan says:

    I currently use Wells Fargo, and I plan on switching baks soon (not specifically due to this, but I’m generally just not happy with them). I’m thinking about going to an online bank, probably the Schwab Investor checking, ING, or Ally. Any recommendations? I live in the DC area, so if you have any brick and mortor recommendations for this area, I would appreciate that as well!

  6. ebow says:

    Are there such things as non-debit ATM cards? If you cancel your debit card, how do you get access to cash other than by going to a branch office during their limited hours of operation?

  7. Bart says:

    I will have to go back and re-read the notice, but I think you will only be charged the $3 fee for items that count as “transactions”. I only use my debit for ATM access and this does not count as a “transaction” from what I recall.

    If I used my debit card frequently though, I would probably just take my accounts and business to another bank that did not charge these fees. I feel the same way about airlines charging baggage fees (you should be allowed to check one bag for free).

  8. Matt says:

    Bart is right – Wells Fargo will impose the fee in a month the debit card is used for transactions, which do not include ATM use. Also, I don’t know if this is a nationwide change – looks like only customers in a few states have received notices so far.

    Personally, I will never pay a bank for the use of a debit card. I hardly ever use debit cards, but as a long-time credit union customer I believe standard banking services should be provided for free.

  9. daenyll says:

    I rarely use debit card, as I get rewards with credit and have the added time buffer to catch any fraudulent charges before I’d lose cash from my actual accounts. But I’d drop the debit card in a heartbeat if I was charged for it. I’ve been consolidating accounts recently, and now that ING is looking to offer actual checkbooks, I will probably be cutting a few more that I’d kept to pay rent and stuff directly with a check rather than having to have a bank send it.

  10. Demi says:

    I kind of figured most brick and mortar banks would start to add all kinds of fees to make up for the billions they were collecting due to people’s mistakes so I opened three on-line accounts as recommended by many on here…Ally Bank, HSBC, and ING. I currently only use these accounts for savings accounts at 1.5% interest (best I can find). All have checking and transfer capability and most of my banking except for some of my local township and county fees (taxes, water, sewer, and trash/recycle) are via bank to bank transfers. Those few I write checks for. I am a WF customer with three accounts…one checking and two savings…plus my IRA. If the $3 fee for debit use comes to PA…WF will be gone. I use my debit card pretty much exclusively for everything from gas to groceries to movie tickets. I also enjoy their Rewards program and have collected quite a few hundred dollars in gift cards from Lowes and others. I know I am making out in the long run even if the $3 fee hits me, but as another has said…will where the fees end? Most bank credit cards are charging a minimum of 11% interest IF you carry a balance (I never do)…and paying squat in savings/checking interest. It is a shoppers market out there for those with excellent credit…why not make use of it? If you stay on top of your banking as I do…you can actually make a little money via rewards.

  11. Stefanie says:

    I live in Oregon and I would switch banks for sure. I did when Chase and then US Bank added account fees. Now I’m at a local bank, and even though I hate their limited hours, I am much happier.

  12. April says:

    I’d be changing banks faster than you can say “lickity split”!

  13. Wilma says:

    Definitely would change and did. WF started charging me a check cashing fee of $2 every month and I didn’t use checks. That checking account was a free work place checking account with Wachovia till WF took over. That account was just to get paid from my part time job but when I quit I didn’t need that account. On the way out the door after closing my account I heard a woman at the drive in complaining about all the new charges and…….why am I being charged a check cashing fee of $2 when I don’t write checks? So I think I did the right thing.

  14. Jard says:

    Cancel….

    Wellsfargo doesn’t offer anything diff… That i can get some place else for free.

    They plan to charge debit purchase transactions. N costco only takes debits.

    Goodbye wellsfargo hello credit union
    n ing or perkstreet…

    U start paying the 3 bucks next thing u know they chargin u some other fee.

    Let the banks know that they aren’t the only banks in town….

  15. qixx says:

    Not the only fee that are starting up.

    2 weeks ago they started charging me for Bill Pay $6/month.

    This week got a notice my “Free Checking” is now paid checking of $7/month.

    And yes i’m moving banks.

  16. govenar says:

    Just don’t use the debit card and you won’t be charged at all…
    (Though, I admit that I did use my debit card once at costco when I forgot to bring my amex card. But I do have debit cards from other, non-Wells Fargo, banks too if I really wanted to use a debit card.)

  17. Shirley says:

    I don’t use debit cards as I receive cash-back points from CC use. If a bank charged me ANY fee for using my own money, I would be out of there in NY minute.

  18. Voting Veteran says:

    Already a Federal Credit Union member, and having dumped Chase (when they stole Washington Mutual!), over charging my SENIOR Account $12 a month, I am ready, actually anxious, to DUMP WF checking, WF debit, WF Savings, even though WF holds 2 of my mortgages, that AREN’T underwater!

    WF is still allowing payment by non-WF accounts, on mortgages. When they start charging for those mortgage
    payments by EFT or Checks, mortgage holders who are underwater will have one more reason to walk away…

  19. Voting Veteran says:

    Already a Federal Credit Union member, and having dumped Chase (when they stole Washington Mutual!), over charging my SENIOR Account $12 a month, I am ready, actually anxious, to DUMP WF checking, WF debit, WF Savings, even though WF holds 2 of my mortgages, that AREN’T underwater!

    WF is still allowing payment by non-WF accounts, on WF mortgages. When they start charging for those mortgage payments by EFT or Checks, mortgage holders who are underwater will have one more reason to walk away…

  20. Ryan says:

    I saw recent post on the blogosphere about the dangers of debit card use for different things (like gas pumps, tab at a bar, online reservations, etc). Getting reimbursed for fraud on debit card is not as easy as credit cards.

    There are really few reasons to actually use a debit card anymore. Only bad things could happen.

  21. Ben says:

    It’s interesting to hear that you would cancel your debit card so readily. The economic minefield (at least in the US) has debit card use increasing dramatically. Search “debit card use increasing” via Google and you’ll get a ton of proof.

    Aside from all the articles supporting the trend, we see actual proof in the merchant statements that we analyze. Debit cards currently account for roughly 50% or more of acceptance volume for businesses with average tickets at or below $25. And the percentage is increasing along with debit card use.

    As for debit cards not being as secure as credit cards in terms of recouping fraudulent charges, it all depends on the issuing bank. The card-issuing bank is responsible for handling fraud and chargeback claims. Some banks are more consumer-centric while others are more merchant-centric.

    An irony playing out as a result of the Durbin Amendment is a consumer migration from debit cards to reward credit cards due to relatively insignificant bank debit fees. Banks make more money on reward card purchases than on debit purchases.

    Currently, merchants must pay card-issuing banks a minimum interchange fee of 1.65% (Visa swiped base reward) to process a reward credit versus 0.95% for a debit card. Once Durbin goes into effect the debit rate will drop to .05%. Hmm, I wonder why banks are trying to discourage debit card use?

    It’s debatable whether the purpose of the $3 fee from Wells Fargo is to make up for lower debit interchange income, or to discourage consumer use of what will be far less profitable debit cards. My money is on a little bit of both.

    Reward credit cards are all well and good so long as you thank the small businesses that are paying for your airline miles and cash back. Don’t think for a second that Wells Fargo or any other card-issuer is footing the bill out of generosity. Heck no, they’re having their cake and eating it too by passing the buck to the ever-waiver backbone of the economy — small businesses.

  22. John says:

    We don’t need more regulation man. The regulation caused our problems in the first place. Durbin is one of the worst senators we have.

  23. skylog says:

    count me in for not really cancelling the card, but moving to another bank. i understand they are looking for ways to find more revenue, but come one…

    all i want is a vanilla account with some basic services. i am sorry, but a debit card is a basic service. if a bank can not give that to me for free, i will take my business elsewhere.

  24. Jon K says:

    If imposed in Florida, yes, I’d change to a ‘local’ financial institution. I’ve already told them as much via their website. I use my debit card for everything; besides, in this state of retirees, there exists an abundance of entities wanting your money and business. However, I would talk to my local WF branch first.

  25. polly says:

    i been with my credit union since i was 5….LOVE them!….no fees cking, free debit cards, no extra fee or interest rate hike for cash advances…


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