After news broke last week that Bank of America would be charging debit card holders a $5 monthly fee for transactions, Citibank made it clear that it had no intention of following suit. Now, days later, it has been revealed that Citibank plans to start charging certain customers as much as $20 every month for not keeping up with the minimum balance requirement on accounts.
Citigroup Inc., which operates Citibank, has started informing customers holding a mid-level Citi Account that, starting in November, they can expect to be charged $20 every month if the joint savings and checking account balance falls below $15,000, according to the Los Angeles Times. Previously, Citi required such account holders to maintain a minimum of $6,000.
In December, Citi customers who have a "EZ Checking" package will be charged $15 per month if their joint savings and checking fails to maintain the $6,000 minimum, the LA Times reports. The "EZ Checking" package is currently free for Citibank customers.
Customers can avoid monthly fees by using Citi's basic account and maintaining a $1,500 combined balance in both checking and savings accounts "or by setting up a checking account with direct deposit of paychecks and at least one automated bill-payment service," Citi's retail banking chief, Stephen Troutner, told LA Times.
Also, Citi revealed last month that it would longer give rewards points for debit card transactions, according to AP.
Within hours of its announcement Friday, Bank of America was hit with angry phone calls and emails from customers none too pleased with the new fee, which takes effect in early 2012. BofA's website also suffered a breakdown that lasted several hours.
Besides Bank of America, several other national and top-tier local banks plan to either follow suit or to boost already existing charges.
According to The Wall Street Journal, Wells Fargo will start charging a $3 fee for some customers in Nevada, Washington, Oregon, New Mexico and Georgia who use debit cards at the register. That program is expected to take effect on Oct. 14.
The New York Times reports that JPMorgan Chase has been testing a program similar to Wells Fargo's, also charging $3 per month for account holders in select states.
Regions Financial, based in Alabama, also plans to start charging $4 monthly for debit card transactions, while SunTrust, based in Georgia, will follow suit with a $5 monthly fee, the paper reports.
Due to new financial regulations that have taken affect, banking institutions feeling the pinch have increasingly been turning to customers to help recoup their losses.