Debit rewards program next on the chopping block at Wells Fargo
After nailing the coffin shut on its debit card rewards program for new customers last spring, Wells Fargo has finally buried the program for existing customers as well.
Beginning in October, Wells Fargo customers can kiss goodbye those rewards points they earned for every $4 they spent using their debit card and the 16 points they earned for every dollar spent at select online retailers.
They'll still be able to use the points they've accumulated until they're gone, however.
On the plus side, you'll be saving the $12 annual fee to partake of those juicy rewards points. That's disappearing, too.
And, really, you won't be missing much because debit rewards are not so rewarding.
The move comes on the heels of an announcement last week that Wells Fargo will begin pain-testing a new $3 monthly debit card fee in Georgia, New Mexico, Nevada, Oregon and Washington. Chase has a similar pain pilot ongoing in the wilds of northern Wisconsin.
Yes, August has been a cruel month for Wells Fargo customers.
The demise of debit rewards was foretold by financial reform legislation.
A Wells spokeswoman blamed the recent move by the Federal Reserve to lower the swipe fees banks can charge merchants on debit transactions from 44 cents to 21 cents.
"We made this decision due to new regulations that limit the amount of money merchants pay financial institutions for processing debit card transactions. The new cap doesn't cover all the costs associated with offering debit cards, including processing, administration and fraud," the spokeswoman told CNN.
Chase, PNC and SunTrust had already put R.I.P. to their debit rewards programs, and likely more will follow suit. After all, it's tough to plead poverty when you're giving dough away.
I think it bears repeating here that independent auditors have determined that an electronic debit swipe actually costs a bank about 4 cents to process.
Consumer groups were outraged when the feds at first set the swipe cap at 12 cents, then caved to push-back from the downtrodden big guys and upped their highway robbery cap to 21.
Does anyone still feel sorry for these poor cash-strapped waifs who received a whopping $1.2 trillion in public money to bail out their despicable behaviors?
I say good riddance to all the chicanery.
Give us service, not schemes.
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