In order to offset projected revenue losses from the Federal Reserve’s cap on debit interchange fees, USAA Bank will eliminate its debit card rewards program.
The San Antonio-based bank said the move will allow the bank to maintain more popular offerings, such as free checking accounts and ATM fee refunds, according to BankTech.com.
The Fed released its final ruling on the Durbin Amendment last week, which caps the amount banks and card issuers can charge retailers for debit card transactions.
The average fee was approximately 44 cents per transaction, while the Fed capped the amount to between 21 cents and 24 cents per transaction.
The interchange fees collected by USAA are used to provide customers with debit rewards, free checking and ATM fee refunds, according to BankTech.com.
The elimination of debit rewards will allow USAA customers to keep the most valued benefits.
"We carefully considered all options and surveyed members when we began assessing the financial impact of the provision," David Bohne, USAA Bank's president, said, according to BankTech.com. "USAA's survey found that members favored free checking and ATM fee refunds over debit card rewards. Based on this feedback, we decided to stop the debit card rewards to maintain the other benefits."