DETROIT, Oct. 31 (UPI) -- Inadvertent beneficiaries of recently announced debit card fees are non-profit U.S. credit unions, officials from credit unions said.
"I would say it's ranging from a 25 percent increase in new members to a 50 percent increase at one of our branches, all within the past several weeks," said Lisa Burroughs, the chief operations officer of the Michigan Schools and Government Credit Union.
That certainly cannot be one of the results Bank of America intended when it announced it would charge most of its debit card holders $5 per month.
Burroughs predicted membership at the nine-branch credit union would grow 5 percent this year, compared to 4 percent in 2010, The Detroit News reported Monday.
With a new law limits the amount banks can charge when a consumer uses a debit card at a retail store -- the law effectively reducing a bank's maximum take from 44 cents to 24 cents -- several national banks tested the idea or announced new fees for debit card holders.
Bank of America announced a $5 per month debit card fee. JPMorgan & Chase and Wells Fargo & Co., both tested the idea, then said they would drop plans to continue with debt card fees.
It has been widely presumed that part of the reason they killed plans to charge fees on debit cards is the amount of criticism heaped on Bank of America for their fee.
Credit unions, meanwhile, are watching their membership numbers swell.
At Michigan's largest credit union, DFCU Financial of Dearborn, President and Chief Executive Officer Mark Shobe said, "We're the antithesis of Bank of America's credit card fee at this point."
"Our best source of new business is our current members' word of mouth, but when the banks do things like they're doing now, that helps us as well," Burroughs said.