The cost to overdraw a bank account could drop to as little as $3 under a proposal announced by the White House, the latest move by the Biden administration to combat fees it says pose an unnecessary burden on American consumers, particularly those living paycheck to paycheck.

The cost to overdraw a bank account could drop to as little as $3 under a proposal announced by the White House, the latest effort by the Biden administration to combat fees it says pose an unnecessary burden on American consumers, particularly those living paycheck to paycheck.

The change could potentially eliminate billions of dollars in fee revenue for the nation’s biggest banks, which were gearing up for a battle even before Wednesday’s announcement. Exactly how much revenue depends on which version of the new regulation is adopted.

Banks charge a customer an overdraft fee if their bank account balance falls below zero. Overdraft started as a courtesy offered to some customers when paper checks used to take days to clear, but proliferated thanks to the growing popularity of debit cards.

  • lagomorphlecture@lemm.ee
    3·
    6 months ago

    Is it still legal for them to hold drafts and post the biggest one first to cause people to incur more fees? If there are multiple pending transactions they should be required to post the one the user transacted first. So if I made 6 $5 purchases then later overdrew on a $100 purchase, but I had the money to cover the first 6 purchases, I should only get 1 fee. Whereas I believe it’s still legal for them to post the larger transaction first, overdraw you, then charge a fee on every other transaction even if you made them first. That’s some real bullshit.