NEW YORK — Consumer fury has felled the monthly debit card usage fee.
Regions Financial Corp. and SunTrust Banks Inc. followed their big bank rivals on Monday by doing away with monthly fees for using debit cards.
Regions, based in Birmingham, Ala., had started charging $4 per month in October. Atlanta-based SunTrust began charging new customers $5 per month in June.
The regional banks made their moves after larger banks including JPMorgan Chase & Co. and Wells Fargo & Co. said on Friday they would end testing of similar fees.
Both Regions and SunTrust said they were responding to "feedback" from their customers.
While they didn't elaborate, consumer feedback on the issue has largely been delivered as outrage that banks would charge their customers to get access to their own money.
It was the news last month that Bank of America planned to charge $5 per month for using debit cards for purchases that galvanized the response. Even President Barack Obama joined in the criticism, as did protesters at "Occupy Wall Street" and its sibling demonstrations around the country.
"I think it was a tipping point for consumer perception, especially in light of what the public has done to bail out large banks," said Norma Garcia, manager of Consumers Union's financial services program. Garcia said it was the first time she saw such a widespread reaction to something like bank fees, but she said they came at a difficult moment.
"We're at a point in history where a $5-a-month fee means a lot to a lot more people," Garcia said.
The widespread anger helped spark a movement that is encouraging bank customers to move their money to credit unions, community banks or online-only institutions that don't charge such fees. "Bank Transfer Day" is slated to take place on Saturday, but neighborhood-based institutions around the country have already reported sharp increases in account openings ahead of the movement's designated date for switching.
Bank of America hinted on Friday that it would modify its plan and drop the fees for customers who use direct deposit or maintain certain balances. But it has made no official announcement detailing the policy shift.
Several larger banks, including Citibank, US Bancorp, PNC Financial and TD Bank, jumped on the issue to highlight that they do not charge debit fees, although they may charge monthly maintenance fees for checking accounts.
Banks pushed the adoption of debit cards in the past few decades in part because it is less expensive to handle transactions made with plastic than with cash or paper checks. Debit quickly became popular, and surpassed credit cards as the most popular form of non-cash payment several years ago. Usage has continued to increase as the economy has continued to struggle.
But a new federal regulation that kicked in Oct. 1 cut in half the fees banks could charge to retailers for processing purchases made with debit cards. That came on top of other recent restrictions for charging overdraft fees — which soared when banks offered automatic overdraft coverage for debit cards — and on top of tighter rules on credit cards. Banks said they were instituting the monthly debit card fees as a way to make up revenue lost to these new rules.
With SunTrust and Regions backing off, that leaves Bank of America the only major regional or national bank left charging the fees.
SunTrust shares fell 90 cents, or 4.4 percent, to close Monday at $19.73.
Regions Financial shares lost 34 cents, or 8 percent, to end the session at $3.93.
- Patient strategy pays off for FBI in ending...
- Supreme Court Justice Antonin Scalia is dead...
- Clinton, Sanders clash over minorities, money...
- See why some are calling Sports Illustrated's...
- US deploys more Patriot missiles in South Korea
- IMAX film 'National Parks Adventure'...
- 'Finally': Pope meets Russian Orthodox leader...
- US, Cuba to sign agreement on restarting...
- Obama sends Congress record $4.1... 29
- Clinton, Sanders clash over minorities,... 28
- Trump, Sanders victorious in New... 27
- Exit polls: Dems trust Sanders more... 23
- But is she honest? Caring? Clinton... 23
- FBI says it has surrounded last... 23
- Last occupiers of Oregon wildlife... 19
- Obama: 'strange things' happen when... 18