The last of the major corporate banks, Bank of America, resigned from their plan to charge customers a small fee for the usage of their debit cards. Bank of America followed suit after Wells Fargo & Co. and J.P. Morgan Chase & Co. announced their intention to drop the fee. SunTrust Banks Inc. and Regions Financial Corp. both decided to stop charging their customers, although these fees have been in place long before the recent controversy (Fitzpatrick).
Bank of America cited the enormous amount of customer backlash against the fees as the reason that they chose not to enforce the fees they planned to begin in 2012. Major banks who intended to enforce the fee were attempting to recover some of the losses that recent legislation has caused them. As a result of a revision to the Dodd-Frank financial overhaul law, the amount that banks are allowed to charge merchants for accepting debit was cut by more than 50%. To counteract the reduction in profits, banks installed many new fees on services that were previously free. However, the charge on debit card usage garnered the most widespread backlash as it affected the greatest number of customers (Fitzpatrick).
"Consumers have clearly said this is a no-go," said Patricia Hewitt, an employee of Mercator Advisory Group Inc. who specializes in debit cards (Fitzpatrick).
Not only were ordinary citizens angered by this decision, but many political mega-figures also expressed their anger. President Obama and Senator Richard Durbin specifically disagreed with the fees, as they were the ones that lobbied for the reduction in merchant fees. However, they did not imagine that the bank would then put the burden of making up these lost profits on their customers. In fact, Senator Durbin sent John Stumpf, the Wells Fargo Chief Executive, a letter detailing the wrongs of the fees (Fitzpatrick). .
Bank of America's announcement that they would begin experimenting with the fees was received the worst, although other banks have been testing out the fees for months.
