Image licensed by Creative Commons, courtesy of flickr user Medill DC
U.S. Representative David Cicilline of Rhode Island is pushing legislation to ban debit card fees.
The freshman Democrat announce Thursday his proposal would prohibit banks from collecting fees for receiving or using a debit card.
This comes as a result of Bank of America’s controversial decision to introduce monthly fees for debit cardholders.
Cicilline says it’s “unconscionable” that large banks are planning to charge customers for card use, especially after receiving bailouts paid for by taxpayers.
Cicilline’s spokesman says he is now looking for a bill co-sponsor.
BofA’s $5 fee and all of the other new debit-related fees banks are now charging are in response to the fall in revenues from debit card transactions that resulted from the passing of the Durbin Amendment and the subsequent Federal Reserve ruling to cap debit interchange at $0.22 + 0.05% of the transaction amount.
In other words, banks are adjusting to the new environment and they have every right, as well as a responsibility to their shareholders, to do so.
Well, apparently Sen. Durbin thinks that they should only generate enough revenues to cover their operational costs, never mind profits, which is a bad word in the senator’s vocabulary. But that is not how a business operates in an open economy. http://blog.unibulmerchantservices.com/why-are-banks-charging-new-debit-card-fees