BofA drops $5 debit credit fee

UPDATE from Matt Browner Hamlin:

The Wall Street Journal is reporting that Bank of America has dropped its plan to charge debit-card users a $5 per month fee. This is a huge victory for consumer groups and this was an issue which added a lot of fuel to the early days of the Occupy Wall Street movement. It goes to show that just because a bank has found a new way to extract wealth from the lower 99%, it doesn't have to do it. Public pressure on banks works.
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Bank of America announced the $5 fee hike in response to a cut in the interchange fee for use of debit cards.

It never made the slightest sense from a business perspective as the cut in rates was phased so that it applied to 'banks too big to fail' before the rest. Encouraging customers to move away from banks that are too big is an administration policy goal.

Had BofA been serious about the fee they would have implemented it immediately. The pre-announcement was a rather obvious attempt to pressure the administration through their customer's complaints. What the bank did not expect was that their customers might take the side of the administration rather than theirs. Occupy Wall Street certainly helped move the needle on this debate.

When I worked for a major public corporation I used lobbyists. One of the rarely mentioned risks of employing 'corporate' lobbyists is that they are all aligned with one party or the other and the influence flows both ways.

Sometimes this is what the customer is actually looking for. In many industries government regulation is an inescapable fact of business life and knowing what the regulations will be as early as possible is far more important than what regulations are actually passed. Republicans expecting the health care industry to cheer at their attempts to derail or repeal parts of the ACA are likely to be in for a rude surprise.

But rather often the lobbyist is simply trying to use the client to advance their own career inside their party.