NCL Applauds CFPB Final Rule on Overdraft Fees
December 12, 2024: NCL Applauds CFPB Final Rule on Overdraft Fees
Contact: National Consumers League – Lisa McDonald, lisam@nclnet.org, 202-207-2829
Washington, DC— Consumers across the U.S. burdened by abusive overdraft fee practices will receive some relief after today’s announcement that the Consumer Financial Protection Bureau (CFPB) has finalized its overdraft rule. The rule will curb many large banks’ fees from $35 to approximately $5, and is estimated to save American consumers up to $5 billion annually.
The National Consumer League (NCL) applauds the CFPB’s rule as it will prevent big banks and credit unions with more than $10 billion in assets from charging junk overdraft fees that burden families with hundreds of dollars a year in unfair charges and push marginalized communities out of the banking system. The rule will push banks to offer straightforward, affordable forms of coverage protection instead.
“Predatory overdraft fees disproportionately harm communities of color and low-income families, but no one is immune to the damaging effects of these exploitative practices,” says Sally Greenberg NCL’s CEO. “By finalizing its overdraft rule, the CFPB is standing up to big banks, protecting American consumers and their hard-earned money.”
The CFPB’s action to protect consumers provides clear rules of the road to ensure consistency and clarity regarding overdraft products. The final rule requires financial institutions with over $10 billion in assets to choose from one of three options for overdraft fees:
- Cap fees at $5 to cover the actual costs to oversee an overdraft program.
- Charge fees based on actual costs and losses as a service, rather than a profit center.
- Treat overdraft coverage like loans, with disclosures, opt-in options, and payment flexibility.
Read the comments submitted by NCL and 143 organizations submitted in support of this rule here.
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