WASHINGTON, DC – Bank of America, America’s second-largest retail bank with about $2.35 trillion in assets, today announced it will reduce overdraft fees and non-sufficient funds (NSF) fees (aka bounced check fees) for its consumer banking customers.
Center for Responsible Lending (CRL) President Mike Calhoun issued the following statement:
Bank of America’s decision will provide much-needed relief for customers who least can afford the burden of overdraft fees and should lead other financial institutions to drop these fees that disproportionately impact low-income, Black and Latino Americans.
The cost of processing NSFs has decreased dramatically in recent years, and banks that use the high cost of repeat overdraft fees to increase their profits contribute to pushing low-income and working Americans out of the banking system. Bank of America’s decision should spur more banks to take this important step to remove customers’ anxiety that an inadvertent overdraft of their account will result in excessive overdraft or NSF fees that further threaten their economic stability.
CRL urges all financial institutions to eliminate bank overdraft fees. We also urge federal financial regulators – the Consumer Bureau, OCC, FDIC, Federal Reserve Board, and NCUA – to take action to protect consumers from harmful overdraft practices. It would be unrealistic and unacceptable for financial regulators to assume financial institutions by themselves will address the systemic problem of harmful overdraft practices.
CRL Report "Overdraft Fees: Banks Must Stop Gouging Consumers During the COVID-19 Crisis"
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