Bank of America is to start charging debit card users $5 a month as it seeks to claw back money it will lose from a change in interchange rules.
From the beginning of next year the fee will be levied on some current accounts in months when cards are used to make purchases, although customers will not be charged for making ATM withdrawals.
News of the plan comes days before the Durbin amendment to Dodd-Frank comes into effect, which will see interchange fees capped at 21 cents per transaction, around half the current average. According to the Wall Street Journal, BofA estimates the rule will cost it $2 billion a year in lost revenues.
Wells Fargo and JP Morgan Chase are both piloting similar debit card fees as they seek to boost revenue but the other big player in the US market, Citi, says it will not follow suit.
Durbin took to Twitter to savage BofA, saying: "Not happy just killing #jobs by gouging #smallbiz w/unfair #swipefees, #BofA going after customers again w/new #debitcard fees".
Mallory Duncan from the National Retail Federation says: "Every time Congress takes a step to protect consumers, the banks use it as an excuse to raise fees. We've seen it when Congress limited late fees and overdraft fees and now we're seeing it with swipe fees. Just as merchants and consumers are about to get some relief, they're doing it again."
However, Electronic Payments Coalition spokeswoman, Trish Wexler, has laid the blame at Durbin's door, insisting: "It is astounding that Senator Durbin, who created today's chaos, is now trying to point the finger at everyone but himself for the widely predicted consumer harm. Senator Durbin has spent years pushing the agenda of giant retailers, while flatly ignoring repeated warnings by consumer advocates, economists, and the financial services industry about precisely this type of consequence."