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#1611081 - 09/30/11 02:38 PM
Re: Dodd Frank and Interchange Fees
Princess Romeo
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Add that to the IBC announcement of branch closures attributed to this and banks are making a statement. At least some.
Consumers probably won't see it that way, but I hope those lawmakers in the beltway will.
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AndyZ CRCM My opinions are not necessarily my employers. R+R-R=R+R Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell
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#1611082 - 09/30/11 02:39 PM
Re: Dodd Frank and Interchange Fees
Andy_Z
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Joined: Feb 2008
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Deleted
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Will paper checks make a comeback??
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#1611522 - 10/01/11 06:28 PM
Re: Dodd Frank and Interchange Fees
Princess Romeo
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What ever happened to just letting a free market society run its course? The interchange fee was invisible for years - most consumers knew nothing about it. They paid the posted price for the merchandise, swiped their card and moved on. Just another example of congress trying to legislate things they know little about in their attempt to punish the banks. I guess they don't realize that is takes a huge amount of capital to keep these systems running as efficiently as they do, absorb the losses for consumer protection that has been in place for years, plus make a little profit for doing it. If you squeeze a tube of toothpaste hard enough with the cap on, the toothpaste will eventually find another outlet.
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#1611548 - 10/03/11 02:59 AM
Re: Dodd Frank and Interchange Fees
rlcarey
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Joined: Jun 2001
Posts: 8,272
Where the heart is
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Well I can tell you that from a merchant standpoint, the fees for being able to accept Mastercard and VISA have become prohibitive in the past few years for small businesses. My experience in that area comes as a Treasurer for a small non-profit group. We took a look at what it cost us to have a merchant account and found that, in some months, the fees exceeded the donations made via credit card. It wasn't just the swipe fees, but there were a number of monthly fees plus a recently instituted annual PCI compliance fee. We tried contacting various banks to see if we could get a better set up somewhere else, but no one was really interested since our annual "sales" volume (donations by credit card) was only about $30,000.
In 2009 we closed our Merchant Account and told our supporters that we could no longer directly accept credit cards for donations, but they were welcome to use PayPal or Network for Good. We wound up saving money by going that route.
I can understand a small "mom and pop" business frustration at this issue. Between insurance premiums (commercial as well as liability), merchant fees, bank fees, local licensing fees, state and federal taxes, plus payroll if you have employees, the squeeze on the middle class small business owner is very tight.
Hence my thought on allowing the merchant to dictate how those credit card fees are paid and showing more transparency to the consumer and let them make the ultimate decision.
Having said all that, it may be a boon to small banks and credit unions who will probably play up the "no fee debit card" advertising to attract new customers/members.
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#1611589 - 10/03/11 02:08 PM
Re: Dodd Frank and Interchange Fees
Princess Romeo
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under the Lone Star
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There are no free lunches Princess. Paypal is a good alternative for nonprofits.
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#1611606 - 10/03/11 02:34 PM
Re: Dodd Frank and Interchange Fees
Pale Rider
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Joined: Oct 2006
Posts: 14,390
Cheeseheadland
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And Citi is up next: http://www.latimes.com/business/la-fi-1001-citi-checking-fees-20111001,0,5755568.story Citibank is next with a new banking fee The Bank of America rival says it will begin charging for checking accounts unless customers keep more on deposit.
Another day, another new bank fee.
As the uproar swelled over Bank of America Corp.'s planned $5 monthly charge for debit card use, megabank rival Citigroup Inc. was notifying many Citibank customers that they soon would have to start paying for their checking accounts unless they maintained significantly higher balances.
Letters are going out across the country alerting Citi customers of account changes, said the bank's retail banking chief, Stephen Troutner. In many cases, that means customers will have to maintain fatter balances to avoid fees, although Troutner said a basic account option makes dodging charges easier.
...
Cheryl Holt of Burbank said she received one of the Citibank letters this week saying her old account with the bank, a so-called Easy Checking Package that had always been free, was being replaced in December with a new account package with a $15 monthly fee or $6,000 deposit minimum.
That sent Holt, a self-employed writer with a son in college, out to move her accounts to the Burbank City Credit Union, which has free checking and free debit cards.
"Should have done it years ago!" she said.
Give it time Cheryl... its only a matter of time before the pinch and squeeze trickles down to your little CU as well.
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#1611641 - 10/03/11 03:41 PM
Re: Dodd Frank and Interchange Fees
Pale Rider
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Joined: Jun 2001
Posts: 8,272
Where the heart is
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There are no free lunches Princess. Paypal is a good alternative for nonprofits. I wasn't arguing for free lunches, but have you SEEN the fees that are assessed on merchant accounts? You want to talk about "junk" fees? As I said, there were some months where the fees exceeded the donations! I can fully understand a small business's frustration at seeing their revenue go out the door for "reconciliation fee", "account status fee" and so on. Most of them can't use PayPal at the register. However......, if there is anyone reading this who works at PayPal, there is a heck of a market opportunity for you!
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CRCM,CAMS Regulations are a poor substitute for ethics. Just sayin'
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#1612249 - 10/04/11 05:48 PM
Re: Dodd Frank and Interchange Fees
Princess Romeo
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Gold Star
Joined: Jul 2007
Posts: 273
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President Obama's remarks in an interview with G. Stephanopoulos on the $5/month debit fee: "This is exactly why we need this Consumer Finance Protection Bureau that we set up that is ready to go."
Are they going to call a properly disclosed fee a UDAAP violation? Are they going to require banks to LOSE money on debit transactions? This is exactly the reason why you don't untether consumer protection rulewriting and enforcement from the agencies focused on financial institution safety and soundness.
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#1612392 - 10/04/11 07:27 PM
Re: Dodd Frank and Interchange Fees
Princess Romeo
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Cape Cod
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Washington blinders just can't seem to "get it": The only parties benefiting from the Durbin amendment are the high debit-volume retailers whose transaction costs got effectively slashed by 50% last Saturday. And anyone who is naïve enough to believe that those retailers will drop prices to pass along the savings has been sucked in just as Durbin was.
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#1612432 - 10/04/11 08:18 PM
Re: Dodd Frank and Interchange Fees
John Burnett
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Power Poster
Joined: Jul 2006
Posts: 4,348
New York City
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I think Durbin basically said BoA was doing an unnecessary money grab and basically suggested to consumers to bank else where. I can't find the link atm.
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#1612453 - 10/04/11 08:35 PM
Re: Dodd Frank and Interchange Fees
ACBbank
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Joined: Jul 2007
Posts: 273
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Yes, he did: http://abcnews.go.com/blogs/politics/201...t-of-that-bank/“Bank of America customers, vote with your feet, get the heck out of that bank,” Durbin said on the Senate floor. “Find yourself a bank or credit union that won’t gouge you for $5 a month and still will give you a debit card that you can use every single day. What Bank of America has done is an outrage.”
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#1612469 - 10/04/11 08:47 PM
Re: Dodd Frank and Interchange Fees
EmilyAnn
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Joined: Jul 2006
Posts: 4,348
New York City
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Thank you Emily.
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"100 victories in 100 battles isnt the most skillful. Subduing the other's military w/o battle is the most skillful." Sun-Tzu
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#1612612 - 10/05/11 01:33 PM
Re: Dodd Frank and Interchange Fees
Pale Rider
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Cheeseheadland
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::pushes breakfast out of the way:: Lovely way to start the morning...
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#1612616 - 10/05/11 01:39 PM
Re: Dodd Frank and Interchange Fees
#Just Jay
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Joined: Feb 2008
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::smacks forehead::
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#1612703 - 10/05/11 03:45 PM
Re: Dodd Frank and Interchange Fees
manimal
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Gold Star
Joined: Jul 2007
Posts: 273
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Debit cards have been made available for free for a long time, but people don't realize it was a perk - just like free checks offered on certain kinds of accounts. And yet Durbin doesn't cry about about having to pay for checks for those "who simply want to access their own deposited money..."
The banking system actually DOES cost money to operate - which is why there are "maintenance fees, ATM fees, overdraft fees, extended overdrawn balance fees, stop payment fees, interchange fees, “research fees” and other fees."
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#1613381 - 10/06/11 06:03 PM
Re: Dodd Frank and Interchange Fees
#Just Jay
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#1613486 - 10/06/11 07:44 PM
Re: Dodd Frank and Interchange Fees
EmilyAnn
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Power Poster
Joined: Nov 2000
Posts: 2,701
PA
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Honestly, I don't know how much more transparent BofA could make this fee. They told the world they intend to charge the fee and gave customers three months to decide whether to use their cards and incur the fee or find a bank that doesn't charge a fee for debit card useage. Seems pretty transparent to me.
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#1613511 - 10/06/11 08:13 PM
Re: Dodd Frank and Interchange Fees
Deena
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Gold Star
Joined: Jul 2007
Posts: 273
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Agreed.
From Mr. Date's comments, it sounds like they want to take TIS to a whole new level...combined now with Rep. Miller's proposed legislation to establish rules for closing deposit accounts. I take Raj Date a little more seriously since the CFPB will have so much unilateral power. But I'm wondering if Miller's proposal might have legs in Congress following the uproar over debit fees.
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