INDIANAPOLIS - Banks are taking more of your money in the form of added fees for using your debit card.
Some banks will be charging a monthly fee for the convenience. Bank of America will tack on a $5 monthly fee for using debit cards for purchases. Regions Bank will charge $4, and some Chase and Wells Fargo markets will charge $3.
"I think it's ridiculous charging fees like that," said Larry Lesser, Indianapolis.
"I'd change banks. Just for a card, five extra dollars? Why?" said Jenny Burdine, Indianapolis.
Banks say new regulations will limit how much they can charge retailers for each swipe of the debit card.
"It is big money to the major banks who have pioneered the use of debit cards," said Larry O'Connor Jr., Butler University College of Business.
The new rules mean a potential annual loss of up to $2 billion for banks. They're looking to make up for that loss somewhere.
"I'd move to another bank," said Mike Rea, Indianapolis.
O'Connor says that's an option - for now.
"Changing might be a short term remedy," he said.
But other banks might soon follow Bank of America's lead. There's also leg work involved in changing your bank, especially if you have automatic bill pay and direct deposit.
"Consumers should probably sit back and see how this develops between now and year end," said O'Connor.
"Hardly anybody uses checks anymore," said Kirsten Larson, Indianapolis.
That's still an option, but there are trade-offs for every option.
"What you give up is convenience," said O'Connor.
Some customers say they'll just withdraw cash from their bank's ATM when they need it to avoid fees. But if you bank with a smaller institution, you may not be able to avoid ATM fees.
"When you go to Chicago, they won't have an ATM on the corner. They won't have one at the airport," said O'Connor.
Some customers joked the fees made them contemplate giving up on banks altogether.
"Keep my money under the mattress!" said Larson.
"I don't think that's a good idea," said O'Connor.
Credit Unions like Forum see the writing on the wall now.
"There won't be many institutions that won't be charging a debit card fee probably by the first of the year and we think that will be a competitive advantage for us," said Andy Mattingly, Forum Credit Union.
Forum expects to get more business because of the new fees.
"We're staying the course. We're not going to be charging a debit card fee," said Mattingly.
Smaller institutions like credit unions won't be losing as much money for every swipe of a debit card like the big banks will be.
"The interchange rates are not going to fall as much as the larger institutions so we're very under that so we're not going to be impacted by that," said Mattingly.
However, even institutions like Forum plan to reduce debit card rewards.
"We will be reducing those just because there's not going to be the revenue there to support that," he said.
Experts say there are trade-offs to using a credit union.
"They usually don't have the vast ATM network, so you have to check," said O'Connor. "I don't think they'll blindly go along with something that doesn't work for them."
Banks like PNC have also made changes to their checking account options. Customers who were previously enrolled in the bank's points system through a checking account will have to choose to enroll in new types of accounts in order to keep earning points. Whoever you're banking with, pay attention to mailings and read the fine print to avoid surprises.
