NEW YORK — Chase and Wells Fargo are joining the list of banks that won't be charging customers to use their debit cards, as the backlash over Bank of America's planned $5 monthly fee continues.
The retail banking arm of JPMorgan Chase will stop charging $3-per-month fees for using debit cards when its pilot in Wisconsin and Georgia is completed in November, according to a source with knowledge of the bank's plans who asked not to be identified by the Associated Press because the bank has not officially announced the plan. Chase, which operates in 23 states, began its test in February.
And it's not alone in rethinking its actions. Wells Fargo & Co. began a similar pilot in five states Oct. 14, testing a flat $3 fee for using debit for purchases. On Friday it also announced that it is cancelling its test program.
Other banks already have more widespread fee policies. SunTrust Banks charges $5 a month for debit cards used to make purchases, and Regions charges $4.
But it was Bank of America's plan to start charging $5 per month in 2012 that lit the issue on fire.
Banks are justifying the fees by stating that they need to recoup revenue lost to new regulations that limit the fees they can collect from retailers for handling debit card transactions. But the new fees sparked a huge backlash.
Signs like, "I bailed out the banks and all I got was a $5 debit card fee" have been spotted at the Occupy Wall Street protest in New York and its sibling protests around the country. The author of the regulations, Sen. Richard Durbin, D.-Ill., called the fee an "outrage" on the floor of the Senate.
The anger appears to be resonating.
On Friday, Bank of America bent. A source at the bank, who asked not to be identified by the Associated Press because the policy is still evolving, said it likely it will offer ways for its customers to avoid debit card fees through using direct deposit, maintaining minimum balances or using Bank of America credit cards.
But a good deal of damage is already done. "Too little, too late," one angry customer posted on Facebook. "I've already switched to USAA!"