Wells Fargo Abolishes Debit Card Fee Program
SAN FRANCISCO -- Wells Fargo & Co. has pulled the plug on its controversial debit card fee test. The banking giant had been trialing a $3 monthly debit card fee in five states, MarketWatch.com reported.
Wells Fargo is certainly not alone when it comes to scrapping debit card fees. According to a Wall Street Journal article, J.P. Morgan Chase & Co., U.S. Bancorp, Citigroup Inc., PNC Financial Services and KeyCorp have taken similar measures.
Banks said debit card fees were needed due to the passage of Sen. Richard Durbin's (D-Ill.) swipe fee reform bill, which reduces the maximum amount a bank can charge for debit card transactions.
Bank of America was the first to subsequently announce a fee for customers who swipe their debit cards for purchases. However, the plan was met with tremendous resistance from consumers and politicians.
In Wells Fargo's case, Durbin himself criticized the move. As CSNews Onlinereported, Durbin wrote a letter to Wells Fargo Chief Executive John Stumpf recently, in which the senator said he was surprised the bank would "pursue this fee strategy in light of the consumer reaction that has been prompted by Bank of America's recent imposition of a monthly debit fee on its customers. If you were hoping that your new fee would go unnoticed, it has not."
According to Marketwatch.com, Wells Fargo recently disclosed that its quarterly income would decline by $250 million due to swipe fee reform. However, perhaps due to consumer antipathy and Durbin's letter, Wells Fargo still put an end to the test program.
"As we adjust to changes in our business, we will continue to stay attuned to what our customers want," Ed Kadletz, head of Wells Fargo's debit and prepaid cards, said in a company-issued release. "This means understanding their needs as we continue to deliver the world-class service, convenience and value they have come to expect from Wells Fargo."