Home About Latest Browse RSS Advanced Search

Federal Reserve Bank of Kansas City
Economic Review
The impact of debit card regulation on checking account fees
Richard J. Sullivan

Starting in 2011, when new regulations capped the interchange fees paid to banks for debit card transactions, some news reports predicted banks might increase checking account fees. The cap reduced many banks' revenue and the concern was that they might offset their losses by charging more for checking accounts. Sullivan examines data from broad samples of banks and finds that many large banks raised fees—but among the thousands of smaller banks that had been exempted from the regulations, some raised fees while others lowered them. On net, consumer access to free checking actually increased. The author also explores data on factors that may have driven banks' decisionmaking, including banks' financial characteristics; aspects of the regional market in which they operate; and the degree of competition they face.

Download Full text
Cite this item
Richard J. Sullivan, "The impact of debit card regulation on checking account fees" , Federal Reserve Bank of Kansas City, Economic Review, issue Q IV, pages 59-93, 2013.
More from this series
JEL Classification:
Subject headings:
Keywords: Checking accounts; Interchange fees; Debit cards
For corrections, contact LDayrit ()
Fed-in-Print is the central catalog of publications within the Federal Reserve System. It is managed and hosted by the Economic Research Division, Federal Reserve Bank of St. Louis.

Privacy Legal