THIS PAGE MAY CONTAIN AFFILIATE LINKS. MEANING WE RECEIVE COMMISSIONS FOR PURCHASES MADE THROUGH THOSE LINKS, AT NO COST TO YOU. PLEASE READ OUR DISCLOSURE FOR MORE INFO.
Beginning October 14, 2011, Wells Fargo will begin charging a $3 monthly fee to It’s debit card customers in 5 states. The fee will be charged to customers who used their debit card in a given month in Washington, Georgia, Nevada, New Mexico, and Oregon. Letters have already been sent to these customers to inform them of the fee.
This move is seen as a response to Federal Reserve regulations that reduce the amount that banks are permitted to charge retailers for debit card purchases. Such fees have been capped at 24 cents, which is just over half of the 44 cents that is currently permitted. The new fee cap is set to begin on October 1st, 2011. The move by Wells Fargo is seen as way of generating additional revenue in the face of the new regulations.
This may not be the only additional fee that hits Wells Fargo customers. Wells Fargo CEO John Stumpf has indicated that the company may raise minimum account balances, add surcharges to checking accounts, un-bundle services, and add a fee to debit card holders just for owning the card. With the $3 fee estimated to generate an additional $200 million in revenue, such other moves could substantially offset the expected losses from the Federal Reserve’s regulations.
As Wells Fargo is the second largest debit card retailer in the United States, the $3 fee could affect a large amount of Americans if it were to go nationwide. In fact, 40 million Americans use Wells Fargo debit cards. Of course, as is generally the case, the customer ultimately will foot the bill for the new regulations.
The $3 fee and possible other fees are sure to rile Wells Fargo’s customer base. Whether they reduce their usage of debit cards or other services remains to be seen. Of course, angry customers can also comparison shop and find alternate providers that offer better pricing. However, as other companies in the industry have been exploring and implementing similar moves, it may become increasingly difficult to find a good deal. Whatever the case may be, it never hurts to know what your options are. Thus, it is a good idea to see what else is out there if you expect your fees to significantly increase as a result of this measure.