Bowing to a national flood of protests, Bank of America Corp. is calling off its plan to charge customers $5 a month for using its debit cards to make purchases — a strategy that proved a public relations disaster for what once was America’s biggest bank.
As I said the other day, there’s no telling how this is going to work out in the end. Banks are going to keep dreaming up new fees to make up for their lost interchange revenue, and only time will tell how those fees shake out. However, I’m tentatively pleased to see what happens when fees are out in the open instead of being hidden: the market speaks, and it speaks loudly. Banks are going to have to actually compete on fees now, and in the end that should benefit consumers by producing lower overall banking costs. Keep your fingers crossed.