Even with major revisions having been implemented to the nation's credit card laws earlier this year, consumers haven't seen the last of changes to the ways they use plastic.
One area that has continued to attract attention from government regulators and consumer advocates is the amount that lenders tend to charge for late fees and overdrafts on debit cards. For example, an overdraft fee can often be as high as $39 even if the purchase that triggered it was as small as a few dollars.
In response, the Federal Reserve recently announced a new set of rules that include the requirement that such fees must be proportional to the amount a person actually overdrafts by. Other parts of the proposal would ban inactivity fees, as well as multiple penalty fees for the same violation of account terms.
The Federal Reserve proposals would also contain language directing card companies to evaluate whether a customer merits having their interest rates brought back to a lower level if those rates were increased since January 1, 2009. Lenders would also be required to inform consumers of the reason their rates had gone up.
In response to the changing climate for consumers and credit card companies, Bank of America made an announcement this week that could be a sign of things to come.
According to the financial services giant, as of this summer it will only approve debit card transactions that are covered by a sufficient amount of money in the account at the time of sale. This would essentially allow the company to sidestep the debate over the size of overdraft fees that consumers are charged in such cases.
The company also noted that people will still have the option of overdraft protection by linking to another account.
"We understand that the environment has changed, and we are changing with it," said Bank of America executive Susan Faulkner.
For consumers who have been working hard to build up their credit score and personal finances, the announcement could be a positive sign because it will give them more of a motivation to keep a close eye on their purchasing decisions. The news also comes at a time when a growing number of consumers have been using their debit cards in favor of credit cards with an eye on cutting back on interest charges and the other fees they may be charged.