The government should have just taken over the banking sector, so we could avoid things like this, The End Of Free Checking?
On Sat., Oct. 1, new regulations from the Dodd-Frank financial overhaul go into effect on debit cards. Specifically, they impose price controls on “interchange fees,” the fees that banks and credit unions charge to retailers on debit card transactions.
The average interchange fee is about 44 cents. The new rules limit the fees to 21 to 24 cents.
“The costs of processing debit card transactions doesn’t go away because you limit the price,” said John Berlau, director of the Center for Investors and Entrepreneurs at the libertarian Competitive Enterprise Institute. “That shifts the costs to consumers.”
These fees are used by banks to offer free checking and rewards programs. But now those programs may be be coming to an end. Just 45% of noninterest checking accounts are now free, down from 65% last year, according to a recent survey by Bankrate.com. The average monthly fee for those accounts has risen 75% in the last year to $4.37.
So prepare for the howls and screams now that Bank of America is charging $5 a month for using debit cards to offset the loss of revenue:
“It seems that old habits die hard for Bank of America,” [Dick] Durbin said in response to the new policy. “After years of raking in excess profits off an unfair and anti-competitive interchange system, Bank of America is trying to find new ways to pad their profits by sticking it to its customers.
“It’s overt, unfair and I hope their customers have the final say.”
Just make everything free. Or have the government provide it, because that’s the same thing as free.