BB&T Corp Chief Executive Kelly King has recommended that banks move toward charging annual fees for debit cards.
During the company’s second-quarter earnings call, King said banks should charge an annual fee of approximately $25 for a debit card, a move that is a common practice for credit cards, according to Reuters.
Account holders, King said, could pay the fee in one yearly payment or make monthly payments of $2.
Banks are looking for ways to recoup revenue they stand to lose as a result of the Dodd-Frank financial reform law, crimping their traditional sources of income, including interchange fees.
A provision in the financial reform overhaul cut the fees that large banks can charge retailers for debit card transactions. The rule is expected to cost the banking industry about $9.4 billion each year, according to Reuters.
Some banks are considering a $30 annual fee for debit cards, according to the Wall Street Journal. In addition, banks are considering limiting the size of a purchase that a customer could make with a debit card.
Several credit card issuers have already eliminated debit card rewards programs, such as free checking accounts and cash back programs.
King said that the Winston-Salem, North Carolina-based regional bank has decided to eliminate free checking accounts and that the bank hopes to recoup the lost revenue caused by the new industry rules, Reuters reports.