Bank of America, the bank that continues to lose billions after acquiring the failing Countrywide mortgage broker, will begin charging customers $5 monthly for any amount of combined debit card purchases made in one month. The move should overjoy Google and other mobile commerce platform providers willing to provide transactions for free.
The bank plans to begin charging customers in early 2012, but it's not the first bank to think about charging a fee for debit card transactions. Chase and Wells Fargo have been testing $3 monthly debit card fees in select markets. Debit cards have been promoted as a free service for years. Now it looks as if banks will trade in the no-change plastic card for electronic mobile transactions.
On Thursday I wrote a short blog directing readers to a detailed report from Verizon Business that explains security flaws in debit-card transactions. In the post I suggest the security holes might lead consumers to mobile ecommerce this holiday season. While it might be a little premature to suggest it would happen by the end of 2011, the findings from the report and new charges set by banks should prompt tech savvy consumers to make the change.
If Google can't convince consumers to use the Google Wallet application based on convenience, the frugal will likely opt-in to the app to save a buck or five. The app relies on a variety of technology, such as near field communication (NFC), a shortwave radio frequency technology. The study -- Verizon Payment Card Industry (PCI) Compliance Report -- explains that most businesses accepting credit and debit cards don't maintain compliance with the standards developed by the PCI Security Council, a group consisting of American Express, Discover Financial Services, JCB International, MasterCard Worldwide, and Visa.