Between the rise of e-commerce, credit/debit card use, and mobile payment platforms, the days of “running to the ATM” for enough cash to get through the day are gone for many people. That’s one of the reasons why, according to a new survey of banks, out-of-network ATM fees and overdraft charges are hitting new highs. [More]
overdraft fees
Frequent Overdrafters Spend $450 More In Fees Each Year, More Disclosures Could Help
By 8.4.17
Under federal law, depository institutions are prohibited from charging overdraft fees on ATM and one-time debit card transactions unless consumers affirmatively opted in. But a new report suggests that those who do opt-in might not know the cost of such a decision, with opted-in frequent overdrafters spending about $450 more in fees each year than non-opted-in frequent overdrafters. [More]
Banks Making $17B A Year From Fees For Overdrafts & Insufficient Funds
By 5.24.16
Overdrafting your checking account might only hit you for $35, but when that happens a few hundred million times each year, it really adds up. A new report estimates that banks in the U.S. are now making $17 billion a year from fees for overdrafts and insufficient funds.
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Chase Customers Can No Longer Use Credit Cards As Backup Funding For Overdrafts
By 5.16.16
Last year, banks made $11.16 billion from customers who overdrew their accounts with a majority of those overdraft fees going into the pockets of the three largest banks: Wells Fargo, Bank of America, and JPMorgan Chase. There could be more fees headed Chase’s way soon if customers don’t pay heed to the company’s changing overdraft policy. [More]
Banks Turned Account Overdraft Fees Into $11.16B In Revenue Last Year
By 2.25.16
Banks with more than $1 billion in assets now need to report on how much revenue they bring in from overdraft fees and other charges. The first report on those numbers shows that banks made $11.6 billion last year from customers who overdrew their accounts.
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CFPB To Banks: Offer More “No Overdraft” Checking Accounts, Provide Accurate Credit Information
By 2.3.16
Some 10 million Americans are considered “unbanked,” often because they are believed to pose too high a credit risk for a bank to offer them a standard checking account. But the federal Consumer Financial Protection Bureau believes many of these people could be brought into the fold if more banks were to offer lower-risk deposit accounts that provided the benefits of a checking account without being a risk to the financial institution. [More]
Federal Inquiry Probes TCF Bank’s Overdraft Practices
By 11.6.15
Overdraft fees cost consumers an average of $32 billion each year. The hefty fees and their often less-than-transparent policies, which vary greatly between banks and financial products, have long garnered the ire of consumer advocates and federal regulators. Case in point: a Minnesota-based bank is now under investigation for possibly unfair and deceptive practices related to its overdraft program. [More]
Banks Continue To Improve Consumer Safeguards, But Progress Isn’t Coming Fast Enough
By 5.12.15
Opening a checking account with a bank is a rite of passage of sorts for many consumers, but the plethora of small-print disclosures, fees and other services are enough to confuse even the most seasoned account holder. While banks attempted to simplify their practices over the years, a new Pew Charitable Trusts report shows that some banks – and regulators – have a long way to go before they’re truly doing everything they can to protect consumers. [More]
CFPB Report: Typical Overdraft Situation Is Comparable To Small-Dollar Loan With 17,000% Interest Rate
By 7.31.14
If you’re one of the hundreds of millions of consumers who use a debit card you’ve likely found yourself on the receiving end of an overdraft fee when your account balance just wasn’t quite enough to make a desired purchase. While consumers might not necessarily question the occasional overdraft fee, a new report from the Consumer Financial Protection Bureau puts the fees into a disconcerting perspective. [More]
Wells Fargo To Stop Reordering Check Transactions; Should Reduce Overdraft Charges
By 7.18.14
A little talked-about way in which banks maximize overdraft fees is by processing transactions not in the order in which they are received, but in a way that results in the largest number of overdrafts. Now the folks at Wells Fargo are putting an end to this practice for its checking account customers. [More]
Despite Regulations Most Consumers Don’t Understand Overdraft Penalty Plans; More Rules Needed
By 6.26.14
Since 2010, financial institutions have been required to obtain an opt-in confirmation from consumers before enrolling them in overdraft penalty plans, yet a new report found more than 50% of consumers who incurred such penalty fees in the past year don’t believe they opted into any such plans. This revelation, coupled with consumers’ concerns over fees and bank practices, has led to a call for federal regulators to improve rules governing financial institutions’ overdraft policies. [More]
Banks Inside Walmart Stores Lead Nation In Raking In Fees From Customers
By 5.12.14
A number of different banks operate branches inside more than 1,000 Walmart stores in the U.S., and many of these banks market themselves to consumers who may not be targeted by larger institutions because of low income or lack of savings and credit. A new analysis of the institutions most frequently found at Walmart found that these banks are also the most reliant on charging fees to their customers. [More]
Banks Improve Disclosures, Falling Behind On Overdraft Fees, Binding Arbitration Clauses
By 4.9.14
Checking accounts come in all shapes and sizes to fit every consumer’s needs – fine, not every consumer. While options can be good when you’re shopping around for a new bank, they also lead to a plethora of fees and risks for consumers. While some practices have improved, a new Pew Charitable Trusts report shows banks have a long way to go and it’s time the Consumer Financial Protection Bureau took action. [More]
Stories You Might Have Missed Because You Were Too Busy Being Awesome
April 5, 2014
We post a lot of stories during the week, and we know that most of you have jobs, families, lives, hobbies, nagging itches and other more important things to do than read every single thing we write. So for those who might be playing catch-up on the weekend, here are some of the things you might have missed… [More]
As Fewer People Overdraft, Banks Are Raising Overdraft Fees
By 4.2.14
If you’re still opted-in to overdraft “protection” — which protects you by slapping huge fees on every purchase you make beyond the available funds in your account — you should probably opt out, as the costs associated with this lucrative system are on the rise. [More]
Bank Of America’s New Debit Card Charges $5/Month For Something That Is Free On All Accounts
By 3.7.14
Bank of America is in the news because it’s testing a new debit card that won’t let customers overdraft. For that privilege, cardholders will pay a $4.95/month fee and they won’t be able to write paper checks. Thing is, anyone with a bank account can turn off overdraft protection without being required to pay a fee. [More]
Big Banks Don’t Want To Be Transparent About Checking Fees If Little Banks Don’t Have To Be
By 2.21.14
If we were to play a word-association game with the nation’s largest banks, we’re sure that terms like “fair” and “equitable” would be right on the tip of peoples’ tongues. And because big banks always play fair with everyone else, they are asking that their checking-account fees not be put under the regulatory microscope if smaller banks’ fees aren’t going be subject to the same scrutiny. [More]
Prepaid Debit Cards: Salvation From Overdraft Fees Or Putting Your Money At Risk?
By 2.6.14
No overdraft penalties, no overspending and sometime low but occasionally ridiculous fees are all perks that have led consumers to an increased use of prepaid debit cards in the last year. And while the cards are convenient there are plenty of reasons consumers should by wary. [More]
