Rep. Bill Owens (D-N.Y.) is sticking with his effort to repeal the Durbin Amendment despite Bank of America’s announcement that it will pull back from implementing a monthly $5 debit card fee.
The bill is still needed as large banks will continue to find ways to generate revenue by making services more costly for customers, Owens said, IStockAnalyst.com reports.
According to Owens, banks will likely end free checking account services and create new fees that do not draw as much attention as Bank of America’s debit card fee that prompted outrage from its customers and Democrats on Capitol Hill, as well as the White House.
Owens said his bill is needed to protect smaller community banks and credit unions that will be affected by the Durbin Amendment despite an exemption for financial institutions with assets less than $10 billion, according to IstockAnalyst.com.
Financial experts predict that smaller banks will be pressured to lower their card related charges to the reduced level offered by the bigger banks in order to stay competitive.
Owens said that as a matter of principle, the government should not be setting rates that are charged by banks to retailers, IstockAnalyst.com reports.
Rep. Jason Chaffetz (R-Utah), the co-sponsor of the repeal bill, has called the Durbin Amendment “an affront to consumers and the banking industry.”
“These legislatively enacted price controls have compelled banks to charge consumers high (and in some cases new) fees to make up for lost revenue,” Chaffetz said.