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An overdraft fee is charged when the bank or credit union covers a deposit account holder’s transaction — a payment, withdrawal, debit or transfer when there is not enough money in that account.
Overdraft fees have been at the center of that campaign, and the White House directed government regulators last year to do whatever is in their power to further curtail the practice.
In one of its final actions under the Biden administration, the Consumer Financial Protection Bureau issued a rule reining in bank overdraft fees.
The average overdraft fee peaked at $33.58 in 2021, according to data from Bankrate, the personal finance site. It declined to $26.61 in 2023. It declined to $26.61 in 2023.
During that time, the annual revenue big banks derived from overdraft fees soared, helped along by the boom in consumer debit cards tied directly to checking accounts.
Once the link is established, when an item is presented to the checking account that would result in an overdraft, funds are transferred from the linked account to cover the overdraft. A nominal fee is usually charged for each overdraft transfer, and if the linked account is a credit card or other line of credit, the consumer may be required to ...
The Biden administration has finalized a rule limiting overdraft fees banks can charge, as part of the White House's campaign to reduce junk fees that hit consumers on everyday purchases ...
The Consumer Financial Protection Bureau finalized a rule that caps overdraft fees. Americans who are charged overdraft fees are now on track to save $225 a year Skip to main content