CFPB Continues to Scrutinize Overdraft Programs. Navigator Edition: November 2. By: Ginna Rodriguez. Overdraft programs can account for as much as 7. Many consumers intentionally use overdraft, allowing them to make purchases with a debit card or check/ACH payments when they do not have sufficient funds in their accounts. But in some instances the overdraft fees paid can be significantly higher than the purchase value and the Consumer Financial Protection Bureau has been closely monitoring overdraft programs since 2. In 2. 01. 2, the CFPB analyzed overdraft program data provided by a small set of large banks representing two million accounts, and in September 2.
In an effort to stem oversight efforts that would curtail overdraft programs from lenders, the National Association of Federal Credit Unions (NAFCU) has urged that.
Office of Management and Budget to conduct a web survey of 8,0. New regulations could follow once the CFPB findings are finalized, further reducing overdraft and NSF fee revenue and prompting banks to re- evaluate checking account pricing. Implications of 2. Overdraft Opt- In Requirements. In 2. 01. 0, the Federal Reserve Board began requiring banks to provide overdraft disclosure forms and seek cardholder consent to participate in overdraft programs for debit transactions under Regulation E. According to CFPB research, 7.
NSF transactions accounting for 7. Figure 2). These heavy overdrafters opted in at a much higher rate than the population overall (4. Figure 2: Accounts and Fees by Overdraft Frequency.
Source: CFPB July 2. Report, Data Point: Checking account overdraft. The . Since the opt- in requirement only applies to ATM and non- recurring POS transactions, an accountholder that did not .
The CFPB believes that the number of people incurring overdraft fees and the average annual overdraft charges vary across institutions due to the diversity and complexity of bank fee structures. For example: some banks limit the number of overdraft charges a consumer can incur in a day to two, while others have no cap on fees; some banks charge an overdraft fee for small- dollar transactions, while others do not charge for transactions that overdraw the account by less than $5. Bank policies for transaction posting (e. While Cordray has stated that the CFPB is not going to ban overdraft products, he indicated that the CFPB wants to develop more uniform policies across financial institutions so that consumers can better anticipate and avoid overdraft fees. To that end, the CFPB is analyzing different aspects of overdraft programs, including fee levels and frequency, occasions for fees, and transaction posting orders. The CFPB plans to include a representative sample of the U. S. The research, which will likely launch in 2.
The CFPB just announced its rule-making agenda for Fall 2015. Contained within its agenda the Bureau is preparing for a rulemaking concerning overdraft programs on. CFPB Study of Overdraft Programs: A white paper of initial data findings: Amazon.es: Consumer Financial Protection Bureau: Libros en idiomas extranjeros. The Consumer Financial Protection Bureau is weighing whether to place further restrictions on overdraft programs after a study released Thursday revealed.
Overdraft Protection Services. Retention of the ability to provide a variety of overdraft accommodation programs to customers who value the benefits of. The costs and risks of civil litigation and intentions of the Consumer Financial Protection Bureau have resulted in curtailment of overdraft programs by some of the.
It will explore consumers. Based on the results of this research, the CFPB will determine if further regulation is needed to make overdraft programs more transparent.
Given that the CFPB recently requested approval and comments on its plans to conduct the survey, it is unlikely that we will see further overdraft regulation before 2.