Wells Fargo cancels debit card rewards
Earlier this year, Wells Fargo announced that it was going to cancel its debit card rewards program, beginning with not allowing any new enrollments. The bank has just announced that all debit card rewards are going to be canceled as of October this year.
Banks scrambling to implement debit card fees
The nation’s largest banks seem to be in competition with each other to see who can implement the most debit card fees the fastest and still keep their customers. According to CBS, Wells Fargo is testing a $3 per month debit card fee and so is JPMorgan Chase. Smaller regional banks are following suit too. Sun Trust Bank, a bank chain in the South, currently imposes a $5 monthly debit card fee and Regions Bank, another Southern bank chain, has added a $4 monthly debit card fee. Banks are also ending debit card rewards programs. Earlier this year, according to CNN, Wells Fargo announced it wasn’t taking any new enrollments to debit card rewards programs and it would be ceasing all debit card rewards later on in the year. Wells Fargo has just announced that debit card rewards programs will cease entirely by October.
Debit card rewards disappearing
Wells Fargo, along with other bank chains, asserts that it is trying to make up for lost revenue because of the Durbin Amendment of the Dodd-Frank Act, according to BizJournals. The Durbin amendment is a portion of the financial reform laws that capped debit card swipe fees, which retailers pay to banks when a customer pays via debit card. The Federal Reserve set the fee cap at 21 cents per transaction; banks normally charge 44 cents. It takes effect October 1, the same date Wells Fargo will cease its debit card rewards programs. Wells Fargo isn’t the only bank killing debit card rewards. According to Nasdaq.com, here is a list of banks that aren’t offering debit card rewards anymore or are ending their programs:
- U.S. Bancorp
- JPMorgan Chase
- PNC Financial Services
- BVAA Compass
- Bank of America
- Capital One
- HSBC North America
- Hudson City Bancorp
- TD Bank
- New York Community Bank
- Citizens Financial
- First Niagra
Some still exist
There are still banks that offer debit card rewards. According to the Houston Chronicle, there are some banks offering cash back on purchases made at specific retailers. Chase, for instance, will have offers for cash back on certain purchases made through its online mall that includes more than 600 retailers. Ally and BB&T both offer similar programs, but usually the merchant rewards are sort of like coupons; one has to make a purchase with a specific retailer, often a specific item or up to a certain amount, to earn the reward. People can also look at sites like Bankrate.com to find banks that still offer debit card rewards programs.