From The Heritage Foundation, I’m Ernest Istook.
When Congress put new limits on credit card companies, they compensated by raising interest rates and lowering lines of credit. And many cards were canceled.
Congress also intervened with debit cards—limiting the fees that banks can collect from retailers.
So to make up the difference, Bank of America has set the pace—and others may follow—by charging customers $5 a month to use their debit cards at stores.
It’s true that under the old system, retailers tacked the bank fees onto the prices of merchandise. But now consumers face an annual fee of about $60 a year for each debit card. But what if retailers don’t reduce their prices to make up the difference?
That means consumers would pay twice. But we also pay a third way: We have to pay more government bureaucrats to enforce these new rules—rules that already are costing you money.
From The Heritage Foundation, I’m Ernest Istook.