Whack-a-mole: BEWARE new fees ahead

Customers across the nation are celebrating Bank of America's decision to back away from its infamous $5 per month fees for debit card users. However, industry analysts are warning that customers shouldn't take to the streets in celebration just yet.

LOS ANGELES, CA (Catholic Online) - Customers should remember that they are dealing with "we have a right to make a profit" Bank of America. And as objectionable as that statement may sound to some, it is also very true. The free-market economy thrives on profit, and unless financial institutions can generate profits, there will be no more financial institutions. What is likely in this case, is that while Bank of America is abandoning the wildly unpopular fees, they will probably come up with newer, more subtle fees to recoup their losses.

Bank of America and several other banks have given in to widespread customer dissatisfaction with anticipated debit card fees. Experts say the debit card fees were wildly unpopular because people felt like they were being charged for accessing their own money.

However, experts warn that new fees will shortly follow.

Bill Herdekopf, CEO of the credit card website lowcards.com said on Tuesday, "Yeah, this is a victory for consumers, but heads up: We're going to be seeing some type of other fees."

Others warn that the new fees will likely be more subtle. Alex Matjanec, the co-founder of Mybanktracker.com, a clearinghouse for public information about banks, said "Now more than ever read those letters you get from your banks. Those booklets with 20 pages? Read through those."

Public backlash, and new legislation which regulates the fees banks may charge have cut into bank's profits over the past year. However, despite these cuts banks are still generating profits. In addition, banks want to show shareholders that they can consistently outperform themselves year after year -- so there is great pressure to generate ever higher profits. While the banks are backing down from debit card fees, it's likely they will find new ways of recouping those losses.

Matjanec warned that consumers need to watch the banks very closely. He said that banks can change account types, which could leave customers more susceptible to different fees. He also warned that higher minimum balances and other fees could make their way into the marketplace.
In the fight against ever-encroaching bank fees, it appears that consumers have won a battle, but definitely not the war.

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