Federal Reserve rules implemented in 2010 were supposed to protect customers from getting hit with overdraft fees if they unwittingly made a purchase that put their account in the red. Now, two years later, banks are still raking in billions, and overdraft fees have hit an average of $30, an all-time high. If you’re wondering what gives, you have company. The Consumer Financial Protection Bureau (CFPB) is wondering the same thing, and according to a new report, it’s taking a hard look at the overdraft practices of the biggest banks.
JPMorgan Chase & Co. is one step closer to a possible settlement of a class-action lawsuit brought against a number of banks over their so-called transaction-ordering practices. “We’re pleased to have reached an agreement in principle,” said spokesman Patrick Linehan, in which the bank has agreed to pay $110 million. That would settle customer claims that [...]
They called it the “$39 cup of coffee.” At many banks, customers were automatically — often unwittingly — enrolled in overdraft programs that would permit debit purchases to go through even if it would overdraw their account, to the tune of up to $35 a pop. But a year and a half after new Federal [...]
Fifth Third bank has debuted a hybrid credit-debit card called Duo, which is linked to both a checking account and a line of credit. But beware: Using the card could be costly.
You’ve heard the news (banks are piling on the fees), and you’re not happy about it (most big banks get D grades). Now it’s time to do something about it.
Bank customers don’t like fees. Early on during the debate over reforming debit card overdraft programs—in which a customer was charged $30 or $35 for swiping a card that lacked enough funds to cover the bill—a survey was conducted to see how many people would prefer that such a transaction would be declined, so long [...]
Bank customers used to be automatically enrolled in overdraft programs, which “protect” the customer by covering debit card expenses even if it exceeds the account balance. The fee for this protection—which only protects the customer from having his card rejected—is about $35 for each and every transaction. As of August 15, however, customers aren’t automatically [...]
These carefully-phrased services sound quite nice, don’t they? But if you read the fine print carefully, you’ll discover that these programs are strategies for banks to collect fees on customers who are careless with their account balances.
When Bank of America eliminated announced it was eliminating debit card overdraft fees, many observers were puzzled. Why would BoA give up such a big money-making scheme entirely, rather than simply tweak it to fall into line with new regulations regarding overdraft protection and fees, like most other banks are doing? And, more importantly, what [...]
Instead of forking over $35 or more each time you use your debit card and don’t have enough money in the account to cover the bill, you might only get hit with a fee of $10 or $19.
Holy moly! Thanks to restrictions put into place in 2009 and 2010 that limit how and when fees can be assessed on debit and credit card accounts, banks are expecting to collect $5 billion less in fees this year. For consumers, this should mean money in the bank—and what do you know, the money is [...]
