And the debit card fees keep on coming.
Citigroup Inc., which last week touted its promise
That decision comes on the heels of Bank of America Corp.'s announcement last week that it will
Citigroup, the third-largest U.S. bank, said last week that it would not "charge fees that discourage [debit] use or make it unreasonably expensive to take advantage of the tools and services that consumers say are important for managing their finances," according to an email from a spokeswoman on Thursday.
But instead of charging for the debit card, Citigroup is now raising the overall price of the underlying account. Bank of America customers who use their debit cards next year will pay a minimum of $13.95 per month for the most basic checking account — which is still less than what some would pay at Citigroup.
Stephen Troutner, Citigroup's head of banking products for U.S. consumer banking, says the bank's checking accounts will still "be extremely competitive" compared to the rest of the industry.
There are "a number of choices for customers to avoid entirely paying a service fee," he tells American Banker.
There are cheaper options at Citigroup. Troutner said the $15 monthly charges apply only to a checking account product that Citigroup discontinued a year ago, and is trying to phase out. The bank
But Citigroup is also raising prices on already-more expensive checking options. The Los Angeles Times reported over the weekend that starting Nov. 1, customers with a "Citi Account" will have to more than double their minimum balance, to $15,000. Accountholders can currently avoid the $20 monthly fee by
Many large banks have
Bank of America and Citigroup unveiled their price increases as the new debit interchange fee caps went into effect on Saturday. The banking industry fiercely protested the rules, which were part of the Dodd-Frank financial reform law.
Troutner would not discuss the number of customers affected by Citigroup's latest pricing increase, or the number of customers the bank expects to lose as a result, but he says "I'm not preparing for a lot" of customers to leave.
Citigroup and other large banks can offer technology and convenience that smaller institutions and credit unions cannot, he says.
"While I respect all my colleagues in community banks and credit union industry, the reality is that's not a great fit for every customer," he says.