An overwhelming majority of Americans favor additional limits on overdraft fees and that's why Congress should pass legislation to strengthen consumer protection in this area, the Consumer Federation of America said today.
The group's poll of 1,016 adults found: 86% favor requiring financial institutions to disclose on the ATM screen if a withdrawal overdraws an account, 74% want financial institutions to be required to get permission before routinely covering overdrafts; and 72% favor limiting overdraft fees charged to one per overdraft.
"There is strong support among Americans for Congress to finish the job, begun by the Federal Reserve, to protect consumers from unfair overdraft fees and practices," said Jean Ann Fox, director of financial services for Consumer Federation of America
Last year, the Federal Reserve issued rules banning credit unions and banks from charging overdraft fees at ATMs or one-time debit card transactions unless the consumer consents or opts in.
However, legislation pending before the Senate Banking Committee and House Financial Services Committee, which CUNA and NAFCU are strongly opposing, would go further. If passed, credit unions and banks would be required to gain a member's or customer's permission before enrolling them in an overdraft protection program and could only charge fees once a month or six times per year.