On the heels of the Durbin Interchange rules, which go into effect in October, USAA has decided to cut its debit card rewards program.
The debit rewards program will end on September 1, GetDebit.com reports. USAA, however, will not be adding other fees or eliminating benefits that its members most value, including ATM fee refunds and free checking.
Interchange fees collected by USAA, which will be dramatically cut when the Durbin Amendment goes into effect, are used to provide customers with debit rewards, free checking and ATM fee refunds, according to BankTech.com.
The Federal Reserve released its final ruling on the Durbin Amendment in June, which caps the amount banks and card issuers can charge retailers for debit card transactions.
According to USAA, the majority of the interchange revenue it collected was returned to its members through various benefits, including the free checking, ATM fee refund and bit rewards programs. The bank, however, was forced to re-evaluate its programs because of the impact of the Durbin Amendment.
“We carefully considered all options and surveyed members when we began assessing the financial impact of the provision. USAA’s survey found that members favored free checking and ATM fee refunds over debit card rewards,” David Bohne, USAA Bank's president, said, according to GetDebit.com. “Based on this feedback, we decided to stop the debit card rewards to maintain the other benefits.