banks cutting debit card rewards into extinction

Financial reform is starting to prove fairly costly. banks are cutting debit card reward programs at an increasing rate. Financial institutions have to be fairer about fees thanks to financial reform laws, however the cost may be that consumers have to lose a little convenience. Legislators are starting to debate whether financial reform is too costly to keep on the books. Source for this article – More banks ending debit card rewards by MoneyBlogNewz.

Giving up consumer advantages for interchange fee cap

To be able to complete debit card transactions, merchants have to pay interchange fees, or "swipe fees," which banks would lose money on with the proposed cap leading them to try to find other ways to make money. There have been fewer free checking and debit card programs available. JP Morgan Chase ended its debit card rewards program and additional are following suit, in accordance with CNN. Wells Fargo subsidiary Wachovia has stopped offering debit advantages to new customers, and Wells Fargo will do likewise on April 15. Citibank recently disclosed that the bank is "in the process of evaluating potential changes," which means it is likely going to cut debit advantages programs for customers as well.

Getting financial reform is costing Additional than anticipated

USA Today states the Government Accountability Office estimated a $1 billion per year price tag on the financial reform bill or Dodd Frank Act. The Consumer Financial Protection Bureau is a whole new agency. There has been lots of arguing amongst lawmakers on the new agency. The Government Accountability Office estimated that federal agencies would have to hire Additional than 2,000 individuals to enforce the laws, including any the Consumer Financial Protection Bureau would be enforcing. Republicans believe the agency will have too much authority. This side of the argument has been openly expressed. Bloomberg states that the agency has been defended by Warren who is in charge of setting it up and claims that "Wall Street behemoths" are going to be targeted, not the Consumer Financial Protection Bureau. Both personal loans and charge cards will be monitored by the agency. It will be in charge of consumer financial products.

Credit could be lost

Stopping financial institutions from taking advantage of customers it he main goal of the financial reform laws. It may be a good idea. Still, financial institutions are already attempting to make up for losses. This has caused debit card advantages and frees checking to disappear. banks have to make up for losses. banks and loan companies will most likely have loan credit get tighter. Many debate this. It might not really be worth it in the end.

Information from

CNN

money.cnn.com/2011/03/25/pf/debit_rewards/index.htm

USA Today

usatoday.com/money/economy/2011-03-28-financial-overhaul.htm

Bloomberg

bloomberg.com/news/2011-03-25/warren-says-consumer-bureau-foes-should-look-at-bank-behemoths-.html