Debit cards: $50 spending limit coming?

[locolady]

No one forces you to use a bank's services. Who is to determine what profit is acceptable or not acceptable? Some liberal bureaucrats in Washington? What is a reasonable profit in your estimation?

OMG it not about them making a profit why do you even care. It about how much they drain out of each transaction for a debit card usage and the effect on consumer.
You're right I'm not force to use a bank service. I don't even pay for my checking account,debit card or bill pay service. I get 1.01% int on my checking account balance with direct deposit that why I use them it is to my advantage not the bank. I still have money at home and keep cash on me because I don't want to be a slave to the ATM FOR MY MONEY. How people got so brain wash by big business to pay them for the use of your dam money. And you are on here crying about the poor bank JC do you realize your advocating against your best interest. How is this liberal I think I'm very conservative. I earn my money with hard work and try to keep as much of it as I can.

[SacMan]

just wondering out loud, will the credit unions fall prey to this as well?? or rather will their share holders become victims of this practice..

[helpme2010]

just wondering out loud, will the credit unions fall prey to this as well?? or rather will their share holders become victims of this practice..

Let me say I still don't believe this will happen. When I opened a new checking account recently I asked about this and the branch manager said they didn't hear anything about this and that this wouldn't make any sense for them to do this. They push hard for us to get debit cards, especially when opening an account. They encourage us to spend with our debit cards. So I don't believe this will happen.

[WhatMoney]

just wondering out loud, will the credit unions fall prey to this as well?? or rather will their share holders become victims of this practice..

Small banks and credit unions are exempt from the new transaction fee rate. Oh, you didn't see this in the scare tactic the large banks are using to delay or kill this new rule? Wonder why. AGAIN, if the large banks are stupid enough to limit debit transactions because they can no longer make obscene profits from debit cards, the answer is simple - move to a smaller bank or credit union that is not affected by these laws. This is why the large banks are engaging in BS scare tactics now. These new lower transaction rates benefit retail businesses, the consumer, and small banks and credit unions with assets of less than $10 Billion. There are only three credit unions in the entire country with assets over $10 Billion. You can see why the Republicans are trying to kill this bill, since anything that might help small businesses or the middle class goes against the Republican whor(e) legislators who are bought and paid for by the large banks.

And another article the Republicans and Conservatives don't want you to know about:


Debit networks lock in swipe fee exemption for small banks, credit unions

Date Posted 3/3/2011

Five major networks have announced that they will implement a two-tiered interchange system so that transactions from small banks and credit unions will be processed at their current swipe fee rate, reported the Merchants Payments Coalition.

“Community bankers and credit unions can now breathe a sigh of relief that the small bank swipe fee exemption in the Durbin amendment will work to their advantage and help them better compete with the big banks,” the Coalition said in a March 1 statement.

“The interchange reform law seeks to bring reasonable regulation to the debit interchange system while preserving the ability of small banks to compete in the debit card market,” said Sen. Richard J. Durbin (D-Ill.), author of the interchange reform language. “Multiple networks have confirmed what I have long argued: that small banks and credit unions will not be hurt by this regulation and will in fact see competitive advantages from it. As the Federal Reserve moves toward final implementation of this law, it’s time to move past the misrepresentations and scare tactics and to recognize the strong pro-consumer and pro-competitive benefits of interchange reform.”

Here is more from the Coalition’s statement:

Visa, Star, Pulse, Shazam and CU-24, which process an estimated 80 percent of PIN debit card transactions, have all committed to a two-tier system that will give banks and credit unions with less than $10 billion in assets higher debit interchange fees than the country’s biggest banks. Other networks are sure to follow their lead.

These five networks have demonstrated their commitment to small financial institutions. Until other networks make their announcements, small banks and credit unions will find the most competitive advantage within these networks and will likely consider shifting their contracts unless other networks announce two-tiered systems.

“Throughout the debate over how to responsibly rein in out-of-control swipe fees, the big banks and credit card companies have sought to scare small banks and credit unions into thinking interchange reform would hurt them. This news confirms what we’ve known all along: that this legislation will help, not hurt, small banks and credit unions in Vermont and throughout the country,” said Rep. Peter Welch (D-Vt.), the leader of swipe fee reform efforts in the House. “Now that yet another swipe fee reform myth has been shattered, we must focus on implementing this new legislation quickly, so that consumers and small businesses alike can benefit from its much-needed protections.”

Only the big banks with more than $10 billion in assets will be subject to the Federal Reserve’s swipe fee rules. As the credit unions flood the Hill with lobbying visits, these announcements confirm that only three credit unions in the entire country, those will more than $10 billion in assets, will see any changes in their swipe fee rates.

“I’d ask Members of Congress to look critically at the rumors about the small bank exemption,” said Lyle Beckwith, senior vice president of government relations at the National Association of Convenience Stores. “Ask the tough questions when you hear lobbyists use this scare tactic, since five major debit card networks have already shown us that small banks will be better off with swipe fee reform.”

Visa announced its intention to create a two-tier interchange schedule in January, and other networks have been following suit ever since. Because banks and credit unions make decisions about which network to use when offering their cards based on which network offers them the highest swipe fees, these moves were not surprising to industry experts.

When Visa made their announcement, payments industry consultant Eric Grover said that the “move makes perfect sense.” He went on to say that industry efforts to draw question to the small bank exemption were “simply intended to scare credit unions and small banks to keep them lobbying.”

“We’ve been saying it all along, and now the market has proven our point that small banks and credit unions will be allowed to continue charging their current fees and that the pricing changes will affect only the big banks,” National Retail Federation Senior Vice President and General Counsel Mallory Duncan said. “It looks like the big banks that have been ripping off consumers with hidden swipe fees are going to have to find a new talking point now that their small bank scare tactic is moot.”

http://www.npnweb.com/ME2/dirmod.asp...2B6B894B4FD2E2

[sepiid]

if it happens

if this happens, ill be getting a paper check mailed to me, and cashing it. i will no longer use a bank that limits my spending in such a strict manner. it is already bad enough when i have to pay for a large purchase in two days, $1500 daily limit, or $500 daily withdraw limit.

i will literally go to an envelope system and take the hit for getting cashiers checks and buying stamps

[WhatMoney]

if this happens, ill be getting a paper check mailed to me, and cashing it. i will no longer use a bank that limits my spending in such a strict manner. it is already bad enough when i have to pay for a large purchase in two days, $1500 daily limit, or $500 daily withdraw limit.

It won't happen - it is a scare tactic in an intense public lobbying campaign to pressure congress to delay the rules. There will be a delay in the rules, and the transaction cap may be increased to cover the bank's claimed costs - but it won't be anywhere near the $0.44 fee they average now. The IT cost for an automated debit transaction is about $0.02.

For large purchases you should either use your credit card option (signature) which provides you more protection, or simply write a check. There are no limits on either. There will always be debit cards available with reasonable limits, namely limited to whatever the balance in your checking account is at the time of the transaction.

I have no idea why consumers are worried or even taking this bank lobby scare campaign seriously. It is all B.S.

[locolady]

Valid point by the last few poster, so glad to hear something by side the typical it's the dam liberal taking our money crap. Here is one more piece to the puzzle of why banks are trying to scare uniformed consumer. http://www.housingwire.com/2011/03/1...yments-decline
The only reasonable conclusion you can come to is the bank's bottom line profit and how to earn it by charging the consumer as much as they can and more.

[helpme2010]

It's so tough to believe anything we hear anymore. There are so many times that the political party or the special interests put out fake stories or use scare tactics to make the public fear something terrible will happen. e.g. just look at the scare tactics they used against Obama and what he would do to our country, or the death panels, or if we tried to charge BP the billions for the damage they caused, that it would cause them to stop doing business in the U.S., or our prices will go through the roof, our children will die, etc. etc.

[OhioFiler]

It's so tough to believe anything we hear anymore. There are so many times that the political party or the special interests put out fake stories or use scare tactics to make the public fear something terrible will happen. e.g. just look at the scare tactics they used against Obama and what he would do to our country, or the death panels, or if we tried to charge BP the billions for the damage they caused, that it would cause them to stop doing business in the U.S., or our prices will go through the roof, our children will die, etc. etc.

Yes, those scare tactics were horrible. Look how well Obama has handled everything so far during his term.

[shark66]

Less then twenty years ago, I was living in a big city across the pond, working for a Fortune 10 (by U.S. standards) company, renting a nice apartment (though they would say "flat" over there), driving an almost-new-paid-in-cash car and didn't have a single credit card in my name...

I got the very first one when I moved here a couple of years later...

I've been living without a credit card - debit only - for five years now and am pretty sure that I could live on cash and checks only without blinking an eye, if needed...

My $0.02 only...

Good luck to us all.

[Clabbergirl]

This is discouraging. I'm still amazed that somehow it became ok for banks to charge their customers a fee for USING the money they keep with them. They make a profit off my money and then want to penalize me for using some of it??? *I* earned it, not the bank. I'm just letting them hold it for awhile. I've been angry about the exorbitant cost of ATM fees for a long while anyway. Instead of paying a teller's salary with benefits, the bank only maintains an ATM at various locations. Now, instead of 7 tellers, now there are maybe 2 when I walk into a bank. Yet I'm going to be charged $3.50-$4.50 for my bank's computer to talk to another bank's computer? All of this is discouraging. It will drive people back to keeping their money in mattresses and dealing only in cash.

[WhatMoney]

I've been angry about the exorbitant cost of ATM fees for a long while anyway. Instead of paying a teller's salary with benefits, the bank only maintains an ATM at various locations. Now, instead of 7 tellers, now there are maybe 2 when I walk into a bank. Yet I'm going to be charged $3.50-$4.50 for my bank's computer to talk to another bank's computer? All of this is discouraging. It will drive people back to keeping their money in mattresses and dealing only in cash.

The bill being discussed in this thread has nothing to do with ATM fees.

But I have to ask, why are you using ATM's from banks you do not have an account with? I would never open a local bank account unless I knew if their ATM locations were convenient for me. Obviously banks do not charge for withdrawing cash from their own ATM's. And out-of-state banks, smaller local banks, and credit unions often will refund any ATM interbank fee if they have a small or no ATM network in your area.

You think it is more convenient to stand in line at a bank waiting for a teller just to withdraw cash, than using their free ATM network? And of course you can get cash back at most large chain stores using any debit card - up to $80 per purchase in grocery stores like Safeway. Another convenient free source of cash using your debit card. Did you lose your job as a bank teller?

[catleg]

I remember when ATM's first came out, I got a free blanket from a bank for making 5 ATM transactions.
Boy how things have changed.
Now the banks think they deserve a piece of every retail transaction.
Finally someone is putting a stop to this.
Essentially they are all wards of the state anyway.
There are still banks that reimburse ATM fees, and you can and should look for fee-free ATMs at stores like WaWa.

[catleg]

I found this article on Credit Slips, everything you want to know about the Durbin amendment and interchange fees and debit card limits.

Credit Slips article

[Clabbergirl]

The bill being discussed in this thread has nothing to do with ATM fees.

But I have to ask, why are you using ATM's from banks you do not have an account with? I would never open a local bank account unless I knew if their ATM locations were convenient for me. Obviously banks do not charge for withdrawing cash from their own ATM's. And out-of-state banks, smaller local banks, and credit unions often will refund any ATM interbank fee if they have a small or no ATM network in your area.

My comment isn't off topic, and you've missed my point. I'm frustrated that banks are finding more and more ways to charge (penalize?) their customers for using their own money. Banks wouldn't exist without customers, yet their practices are becoming similar to auto insurance (where you are penalized with higher rates for using the very service you pay for). I withdraw cash when needed from my own bank whenever possible of course, who doesn't? There are times where life happens and one can't foresee the need to withdraw cash in advance. Selecting a bank with convenient ATMs is common sense, but no bank has them everywhere.

You think it is more convenient to stand in line at a bank waiting for a teller just to withdraw cash, than using their free ATM network?

You're putting words in my mouth (and jumping to conclusions based on assumption).

And of course you can get cash back at most large chain stores using any debit card - up to $80 per purchase in grocery stores like Safeway. Another convenient free source of cash using your debit card. Did you lose your job as a bank teller?

Not a teller, not even close. In my experience, getting cash back at checkouts has not been free of fees. Two banks and 1 credit union would charge me for cash back withdrawals at a checkout. One charged me a fee when I did a debit transaction instead of credit, regardless of any cash back. I was handing the bank an extra $1.50 every time I bought something. Your tone is condescending, but your words indicate you're happy with the selection of banks available in your area.

I'll repeat my point - I feel the proposal discussed in this article is yet another example of how banks are shifting from 'providing a service to customers and are headed toward 'allowing use by customers' (note the implied entitlement).