Wells Fargo is aiming to recoup at least 50% of swipe fee revenue loss by growing debit card payments and implementing “product changes,” said Chief Financial Officer Timothy Sloan during the bank’s Q3 conference call. These changes may include new debit usage fees, according to Bloomberg.
(Related: New Debit Fees Keep Coming from FIs; Is Your Bank Next?)
Wells Fargo is testing a $3 debit usage fee in five states, and Bank of America recently revealed plans to begin charging $5 monthly to those consumers purchasing via debit (Those only using the card for ATM purposes will not be docked.)
“The way we think about that is, our focus is on building lifelong relationships with our consumers,” said CEO John Stumpf when asked why the company was only looking to recover half of lost swipe fee revenue. “We have grown checking and savings account dollars by $185 billion in three years. That represents consumers responding to the value, the convenience and the choice we are giving.”
New debit interchange caps will cost Wells Fargo $250 million per quarter, said executives during the call.
“Our customers help us understand how they want to pay for that value, that choice and that convenience,” continued Stumpf. “We will learn from the tests, and we’ll do what we think will be appropriate so we continue to grow our customer base.”
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