Citigroup Inc. is raising the fees it charges customers for its basic checking accounts and it will no longer give them rewards for using its debit cards, in the wake of new regulations capping debit interchange fees, the company announced Sept. 16.
Starting in December, Citigroup will charge customers $10 per month for a basic checking account, up from $8 per month currently.
The New York bank also said it had made "the hard decision to stop giving reward points for debit card transactions," according to a press release.
Several other large banks this year have signaled plans to eliminate debit rewards, including JPMorgan Chase & Co. (
The biggest U.S. banks have largely eliminated free checking since 2010, when the Dodd-Frank financial reform law slashed the revenues that banks earn from processing debit card transactions. As a result, nearly two-thirds of large banks have added fees, discontinued rewards programs, or changed the terms of their checking accounts, according to a recent Moebs Services survey.
Citigroup said on Friday that customers can avoid paying monthly fees for checking if they receive at least one direct deposit and make at least one online bill payment through the account every month. Customers who keep at least $1500 deposited in Citigroup basic checking and basic savings accounts are also exempt from the fees.
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