Many FIS have or are planning to impose new debit and checking account charges in the post-Durbin era – fees by Bank of America, Citi and Wells Fargo among the most notorious. What’s a pocket-pinched consumer to do? One obvious solution would seem to be paying with credit rather than debit cards at the cash register, right?
Think again, says reporter Brent Hunsberger of The Oregonian.
“First, credit cards cost merchants much more than debit cards,” he writes. “Normally, credit-card swipe fees range between 2 and 3 percent of each transaction, Federal Reserve economists say. If we start using cremdit cards more, expect to pay for it in retail prices.”
Don’t forget about the financial penalties and interest fees should you miss a monthly credit card payment, reminds Hunsberger, claiming they could even cost more than debit-card charges. And if you’ve experienced difficulty in the past making ends meet on your monthly credit card statement, don’t start putting more on your card now, suggests Hunsberger.
He’s not a fan of prepaid cards or switching banks as solutions, either.
“[Prepaid cards] carry even higher hidden fees,” he states. “Better to simply use cash. I admit, the problem with switching banks is that many experts expect some or all of these institutions to eventually raise either debit or checking account fees.”
Click here to read the full article, plus more on Hunsberger’s survey of Oregon banks and credit unions regarding potential new debit fees.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More