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Big banks back off monthly debit card fees

October 28, 2011 12:00:00 AM PDT
Some big banks are doing an about-face on monthly fees for debit cards.

Bank of America's planned $5 monthly fee for debit card users isn't sitting well with many customers.

One Washington, D.C., woman was so outraged at B of A that she launched an online petition against the bank. That petition has almost 300,000 signatures.

Earlier this month ABC News cornered Bank of America CEO Brian Moynihan to ask about the campaign against the fee, and he didn't seem to understand the uproar.

"The fee will start next and year and it will be fully explained to the customers," said Moynihan.

Thursday, Moynihan told employees he was incensed by the bad publicity, but won't budge on the new fees.

Friday, it seems B of A may be bending a bit. The bank reportedly 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 for some, it's too little too late. Some people are moving their money to different banks or to credit unions.

Banks are trying to justify the fees by stating that they need to recoup revenue lost due to new regulations. But with a huge backlash from customers, some banks are doing an about face. Chase and Wells Fargo are dropping their monthly trial of debit fees. Others like US Bank, Citi and Key Bank are holding the line, for now.

"What we heard from our clients was a clear voice: tough times for consumers, and when they get fees they feel nickeled and dimed," said KeyCorp Chairman and CEO Beth Mooney.

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