American Banker: Reality sets in on debit card profitability

AB reports on bankers imposing fees on consumers for using PIN's rather than signatures with their debit cards. Of course, smart merchants have installed systems which detect cards that can work either way -- and are prompting consumers for PIN's simply because the transactions are much less expensive for the merchants! Who's going to blink?

The executive in charge of Bank of America's debit card program - the nation's largest - warned recently that the growing trend of charging customers to use debit cards could doom debit products. "We may price folks away from this product, and then everyone's back to handling paper," Darrell Esch, a senior vice president at B of A, said in an address to the 14th annual Card Forum and Expo, sponsored by American Banker parent company Thomson Media. Mr. Esch called himself "no big fan of the fees."