NEW YORK (Bloomberg) - Tracy Hickman's dinner for three at Taco Bell cost $11.99. She ended up paying $300 for overdraft charges triggered by the meal and other debit purchases.

Hickman says the expense resulted from delays in processing her child-support check at the Zanesville, Ohio, branch of Cleveland-based National City Bank. The 45-year-old customer- service representative said she uses a debit card more these days after cancelling her credit cards because of high fees.

"I stopped using credit cards to keep me out of trouble and then got hit with overdraft fees," Hickman said. "It's not fair."

Customers are shifting to debit transactions from charge cards as credit lines have been lowered and banks have closed inactive accounts. Debit cards will be used in 60.2 percent of card transactions in 2010, or about $40 billion, up from 58.2 percent in 2008, according to the Nilson Report, an industry newsletter in Carpinteria, California.

"Fee abuse hasn't disappeared in banking with the credit- card legislation," said Tony Plath, a finance professor at the University of North Carolina Charlotte. "It's just migrated to checking accounts," he said, referring to the legislation signed in May to protect cardholders from excessive fees and last-minute contract changes.

Charges related to overdrawn US accounts may rise to $38.5 billion this year from $36.7 billion in 2008, according to data compiled by research firm Moebs Services Inc. in Lake Bluff, Illinois. Bank of America Corp. in Charlotte, North Carolina, the largest US bank, charges customers $35 for transactions greater than $5 that have insufficient funds.

"By extracting these fees, banks are walking across the battlefield and shooting the wounded," Plath said. "They should want to husband and protect deposit accounts rather than treat them as a cash cow."

A consumer who overdraws an account by $20, repays the bank in two weeks and pays a $27 fee would be charged the equivalent of a 3,520 percent annual interest rate, according to a study released last year by the Federal Deposit Insurance Corp. (FDIC)

Financial companies have to increase their fees to counter loan-related losses and lower revenue, said Mike Moebs, chief executive officer of Moebs Services. Almost half of the 2,000 banks and credit unions surveyed by Moebs would be unprofitable without revenue from overdraft fees.

Hickman said she was evicted from her apartment after failing to pay her rent because of overdraft charges totaling $1,000. National City delayed depositing checks into Hickman's account three times, which resulted in several overdraft fees when debiting groceries and gas, she said. National City, acquired by PNC Financial Services Group Inc. on December 31, declined to comment on the specifics of Hickman's case.

About 25 percent of Americans paid at least one overdraft fee in 2007, according to the FDIC's study.

Banks will usually cover up to $500 in overdraft protection, Moebs said.

Since the Federal Reserve doesn't require banks' overdraft programmes to comply with the Truth in Lending Act, they don't have to disclose annual interest rates, said Jean Ann Fox, director of financial services at the Consumer Federation of America.

"With these 'courtesy programmes', banks are inviting you to park and then hitting you with a ticket," said Chi Chi Wu, a staff attorney at the National Consumer Law Center in Boston.