Wells Fargo & SunTrust Cancel Debit Rewards Programs

Last week, we wrote about JPMorgan Chase’s decision to get rid of rewards programs for debit card users in response to a new law that will slash the amount of money banks receive per debit card transaction. Now comes news that at least two other banks — Wells Fargo and SunTrust — have followed suit.

According to CNN, current Wells Fargo customers will continue with their existing rewards programs but new customers will not be given the option of enrolling in any of the programs.

Current Wells Fargo card holders shouldn’t feel too secure. Earlier this year, Chase had said that existing rewards members would be allowed to continue, only to have that decision reversed a few months later.

Meanwhile, at SunTrust, customers will stop accruing rewards points as of April 15. And any points that customers have earned by that time will expire Jan. 1, 2012.

CNN reports that Citi, which hasn’t made an official announcement regarding debit rewards, is “in the process of evaluating potential changes to our rewards programs.”

These changes, along with increased ATM fees and proposed maximums on debit card purchases are a reaction to a new rule that will limit interchange fees, the amount of money banks charge retailers for each debit card purchase. Currently, the national average is around $.44 per purchase. The new legislation will limit that to $.12 per transaction.

Speaking of Wells Fargo, Chase and Citi, all three were part of this year’s Worst Company In America tournament. In fact, Chase beat Wells Fargo in the first round and will be facing Capital One in the Sweet 16 on Wednesday. Citi lost to Bank of America in the first round.

Wells Fargo, Chase, SunTrust cancel debit rewards program [CNN]