Thursday, March 18, 2010

Bank of America Gets Rid of Its Overdraft Fees on Debit Cards

Some days ago, in an attempt at improving its relationship with the general public, Bank of America announced it will stop charging overdraft fees on purchases made with it debit card. This will be effective beginning this summer. Bank of America and all other banks will now need to get customer permission to before providing overdraft protection on purchases made with debit cards and on all A.T.M. withdrawals, thanks largely to the new federal CARD Act legislation.

Over the years, banks thrived on these overdraft fees. According to an article in the "New York Times," "Debit purchases account for roughly 60 percent of overdrafts at Bank of America, the nation's largest issuer of debit cards." The article also states that other banks will probably follow suit.

The article continues that "93 percent of the fees are generated by just 14 percent of the customers who exceed their balances (on their debit cards) five times or more a year."

As I've stated within this blog, on other sites, and to my audiences, there is no substitute for personal responsibility. While the banks have taken advantage of the consumers, they've done so largely because we'v allowed them to do so. The banks "play on" our ignorance and laziness and so many of us just act like victims.

Yes, the new federal regulations should empower the public, but this is no time to get complacent. In fact, it is time to learn all we can about our rights and responsibilities as consumers. REMEMBER - the banks work for us; we should not work for them.