NEW YORK ― Citigroup Inc. said it will start charging a monthly fee of $10 on checking and savings accounts with combined balances of less than $1,500, joining a growing list of banks seeking to recoup revenue lost under new financial industry regulations.
The fee will be waived if a customer completes one direct deposit and one online bill payment per month through an account, or maintains a balance of at least $1,500 in checking and savings accounts, Citigroup said on Friday
The change takes effect in December.
Under Citi’s current fee structure, customers are not required to maintain minimum account balances but must complete five transactions a month through an account to avoid a monthly fee of $8.
Citigroup said it will not charge for debit card use or online bill payment.
Stephen Troutner, head of banking products for Citi’s U.S. consumer bank, said free debit card use could woo customers from other banks that are weighing whether to charge for debit card use, such as JPMorgan Chase & Co and Wells Fargo & Co.
“Customers have told us in no uncertain terms that is a huge source of irritation,” Troutner said.
Citi is the latest bank to tinker with its fee structure following changes in U.S. consumer banking regulations and laws over the last two years.
New regulations — part of a broad financial sector reform effort — limit overdraft fees and other penalty fees banks can charge.In response, many banks have begun introducing monthly service fees for accounts, debit card use and visits to branches.
Bank of America Corp, the largest U.S. bank by assets, added checking account fees last year. The BofA changes include an ebanking account, which allows customers to use ATMs and online banking for free but charges a monthly fee of $7 for teller visits or receiving paper statements.