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Community-Focused Credit Unions Should Have Dumped ‘Junk Fees’ Long Ago

CUs cannot profess to protect consumers while simultaneously maximizing their revenue through overdraft fees.

By Paulina Gonzalez-Brito | November 17, 2023 at 09:00 AM
Junk Fees – Statistics/Business. Laptop in the office with term on the display Credit/AdobeStock

On Oct. 11, the Biden Administration unveiled a crucial set of proposals aimed at curbing excessive consumer fees, such as overdraft and nonsufficient fund (NSF) fees, often called “junk fees.” This move represents a significant step toward rectifying an issue that has long burdened consumers, particularly low-income consumers and consumers of color.

By now, the general public may have experienced or at least may be aware of the substantial consumer fees banks collect, as well as the exorbitant “service” and “convenience” fees charged by the retail and hospitality industries. Together, these sectors generate millions in junk fees – all at the expense of consumers, many of whom live paycheck to paycheck. One of the more surprising culprits of these fees is credit unions.

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