Plans by Bank of America and other major banks to charge customers as much as $60 a year for debit card purchases is likely to benefit Maine-based lenders, officials of the state’s largest independent bank and its credit union association said Monday.

“We certainly expect to see alienated customers looking for a local option,” said Yellow Light Breen, senior vice president for Bangor Savings Bank.

A survey of Maine’s 64 credit unions showed that none plans to charge fees for debit card use, said John Murphy, president of the Maine Credit Union League.

“It’s good that consumers have a choice,” Murphy said.

Bank of America, the nation’s largest bank, announced last week that it will charge $5 a month for debit card use, starting in January. The charge is a response to new federal rules that cut the maximum fee that merchants pay to large banks in debit card transactions.

To make up for lost revenue, banks with more than $10 billion in assets, including Wells Fargo and Chase, have imposed new fees or plan to start charging them. Citibank said it won’t follow suit, but it is raising the minimum account balance needed to avoid a monthly fee.

Smaller banks and credit unions aren’t covered by the new rule. They remain better able to offset the cost of “free” products and cash-back rewards by receiving a small portion of each transaction fee.

It’s too early to know the extent to which the controversy will shake up banking habits. But large national banks hold a high concentration of debit cards, and the fee announcements have caused a public backlash. Some customers have threatened to stop using their cards or switch banks.

The anger reflects the fact that consumers have been shifting their spending in recent years from credit cards to debit cards, relying on them for everything from store purchases to online bill paying.

Debit cards are the fastest-growing product for credit unions, said Murphy. At Bangor Savings, 75 percent of customers use their cards. They swipe them 20 times a month on average.

A statewide survey done by the bank last winter showed that more than one-third of residents use a debit card every day, Breen said.

That popularity isn’t lost on Maine-based lenders, notably community banks and credit unions. They typically offer free debit cards that require no minimum balance. Some also offer “rewards” features for using the cards.

They’re now trying to draw added attention to the distinction.

The Bank of Maine, for instance, offers 5 cents cash back for qualifying transactions, including debit card use.

“It costs us money, but it pays us to have a valuable customer,” said Renee Smyth, a spokeswoman for the bank.

To capitalize on public unrest, The Bank of Maine sent out a news release Friday highlighting its no-charge debit cards and its reward checking account, which has no monthly fee and requires a $25 minimum balance. It plans to follow up with advertising.

The Sanford Institution for Savings is advertising Fast Lane Checking, which pays 25 cents for debit card purchases, up to $5 a month.

“It’s a bit of a calculated risk, but we hope to gain new customers,” said Mark Mickeriz, the bank’s president.

In Portland, Evergreen Credit Union has a message on its sign on Riverside Street to say it has a no-fee debit card.

Savvy lenders also are tapping into social media to take the public’s pulse. Tracking Bangor Savings Bank in recent days on Twitter and Facebook posts has shown that some people discussing Bank of America’s announcement are steering their friends to Bangor Savings and local banks that offer free cards, Breen said.

Staff Writer Tux Turkel can be contacted at 791-6462 or at:
[email protected]