JP Morgan Chase Bank is not done changing its programs in apparent response to new regulations against fees. The large bank is increasing ATM fees to $5 for non-customers and considering limiting debit card transactions to $50 or $100. Now, Bloomberg News is reporting that they are eliminating their debit card rewards program.
Debit card proponents often cite debit card rewards programs as a legitimate alternative to credit card rewards programs. Unfortunately, debit card rewards programs were never quite as valuable as their counterparts. As Chase goes, so will go the rest of the industry.
Do you believe consumers deserve rewards programs? I believe that it’s unfortunate when an existing benefit is taken away, but credit and debit card users should not continue to expect these types of benefits. When companies feel pressured to increase profits, which many will when they believe their revenue will be reduced due to increased regulation, some of the benefits we’ve grown accustomed to will disappear. There could easily be a world in which all credit cards have annual fees, all banking products have maintenance fees, and any sort of service could trigger a cost. While we’ve grown to accept the idea of free — free content online, free banking products, free credit cards with rewards programs, free parking, etc. — it might be worthwhile to adjust our expectations.
There are valid arguments for certain products and services that should remain free. For example, there’s a theory that if content, like a television show, is supported by advertising, the consumer shouldn’t have to provide an alternate income stream. The sponsors should cover the cost of production and distributions. Nevertheless, it’s more common to pay for content and still be subject to advertising.
Do you mourn the disappearance of debit card rewards programs and other services or benefits?