Bank of America Wants Customers to Pay for Financial Regulation

The bank plans to charge customers $5 a month to use their debit cards

Bank of America isn't afraid of blaming Congress for their problems. On Thursday, the nation's largest lender confirmed rumors that they were going to start charging their debit card customers a monthly $5 fee for debit card services, and their spokesperson was not shy about tipping her hat to the post-financial crisis Dodd-Frank Act in the process. "The economics of offering a debit card have changed with recent regulations," said bank spokeswoman Anne Pace. "And we've decided to introduce a monthly fee for customers who use their debit cards for purchases." Bloomberg's report describes how the Dodd-Frank Act's cap on swipe fees is affecting Bank of America's bottom line:

The Fed capped debit-card swipe fees at 21 cents starting Oct. 1. It will let issuers tack on five basis points, or 0.05 percent, of each transaction, or almost 2 cents based on the average debit purchase of $38, and a conditional 1-cent adjustment for lenders that follow certain fraud-prevention standards.

The cap, mandated by the Dodd-Frank Act, replaces a formula that averages 1.14 percent of the purchase price, or about 44 cents. The limit may reduce annual revenue at the biggest U.S. banks by $8 billion, data compiled by Bloomberg Government show. 

Of course, the multi-billion dollar costs of paying out settlements to victims of Bank of America's predatory lending practices during the financial crisis--one of the many bad behaviors that led to the passage of Dodd-Frank--certainly don't help either.