The Washington Independent
The Washington Independent

With Pressure From Congress, Big Banks Move to Curb Overdraft Fees

For months, Congress has had its eyes on reining in the overdraft fees tacked on by many banks when consumers -- often unbeknownest to them -- exceed their

Liam Evans
Last updated: Jul 31, 2020 | Sep 23, 2009

For months, Congress has had its eyes on reining in the overdraft fees tacked on by many banks when consumers — often unbeknownest to them — exceed their balances with debit card purchases. Rep. Carolyn Maloney (D-N.Y.) introduced a consumer protection bill earlier in the year, and Sen. Chris Dodd (D-Conn.) has vowed to follow suit later this fall.

Yesterday, that threat paid dividends, as two of the nation’s largest banks — Bank of America and JP Morgan Chase — announced plans to revamp their debit card policies voluntarily to add some of the consumer protections being pushed by the lawmakers. From The New York Times:

Bank of America said it would allow current customers to turn off the ability to spend when their account hits zero, starting Oct. 19. Next June, the bank plans to limit the number of times each year that current customers can overdraw their accounts when using a debit card at a store. It will let new customers choose whether they want overdraft protection when they are opening their account.

Chase would eliminate another controversial practice by which the banks reorder a customer’s debit purchases according to amount, rather than chronology — a scheme that creates more overdraft fees, which currently average upwards of $30 a pop.

The moves are not insignificant. Overdraft fees, which have grown steadily in recent years, are estimated to bring in more than $38 billion to the banks in this year alone, according to Moebs Services, an Illinois-based financial research firm.

Still, you can bet that Democrats will want to mandate the consumer protections, rather than leaving them to the discretion of the banks to install.

Liam Evans | Liam Evans is a freelance writer and social media manager who specializes in assisting finance professionals and Fintech entrepreneurs in growing their online audience and attracting more paying customers. Liam worked as a bank teller and virtual assistant for financial firms in the United States and the United Kingdom for six years before beginning her writing career.


Rep. Paul Ryan to deliver SOTU response

Chairman of the House Budget Committee Rep. Paul Ryan (R-Wis.) will deliver the Republican response to the State of the Union Tuesday, according to Mike Allen

Rep. Paulsen allies with medical device industry to relax FDA oversight

Source: Flickr; Republicanconference ( On the heels of the Minnesota Independent story last week about U.S. Rep. Erik Paulsen’s cozy financial relationship with the medical device industry, the New York Times reported Tuesday that some health professionals are alarmed by Paulsen’s push to relax Food and Drug Administration (FDA) oversight

Rep. Paulsen touts balanced budget constitutional amendment

In a post for the conservative blog True North , U.S. Rep

Rep. Patrick McHenry: Please, Conservatives, Fill Out Your Census Forms!

The conservative congressman from North Carolina, a constant critic of the census -- one of the people who sounded the alarm about politicization when the

Rep. Paulsen, Karl Rove the latest to get ‘glittered’

Rep. Erik Paulsen and former Bush staffer Karl Rove were both showered with glitter at the Midwest Leadership Conference Friday

Rep. Perlmutter to hold constituent meet-up in grocery store

Colorado Congressman Ed Perlmutter will hold a Government in the Grocery constituent meet-up this evening from 5-7 at the Safeway at 38th and Wadsworth in Wheat Ridge. The address is 3900 Wadsworth. The meeting, where Perlmutter typically sits at a folding table and talks to whomever shows up, is free and open to the public

Rep. Perlmutter criticizes House measure that would eliminate 800K federal jobs

Congressman Ed Perlmutter today issued a scathing statement criticizing the House of Representatives for passing a spending bill that could put nearly a million federal employees out of work. The Colorado delegation voted strictly on party lines, with all four Republicans voting in favor of the bill and the three Democrats voting in opposition. Perlmutter’s statement: “My number one priority is to get people back to work because that’s the best thing we can do to pay our debt and move forward toward economic stability

Rep. Pete Stark Won’t Dignify Constituent by, er, Micturating Upon His Leg

In the tradition of Rep. Barney Frank (D-Mass.), California Democratic Rep. Pete Stark revealed at a recent town hall gathering that there are limits to what

Rep. Peace, ACLU seek investigation of soldier’s allegations of racial discrimination in Afghanistan

Both Rep. Steve Pearce (R-NM) and the American Civil Liberties Union agree: There needs to be an investigation into Spc.

© Copyright 2021 The Washington Independent All Rights Reserved

Terms & Privacy |