Bank of America slashed the amount it charges customers when they spend more than they have in their accounts and plans to eliminate entirely its fees for bounced checks.
It's the latest move by the nation's biggest banks to roll back the overdraft fees they long charged customers, fees that often amount to hundreds of dollars a year for frequent overdraft users.
Altogether, Bank of America estimates the steps will cut its overdraft-fee revenues by 97% from where they were in 2009, the year before it started taking incremental steps toward reining in overdraft-fee revenues. "I've been working to reduce or eliminate overdraft fees for 20 years and to give them credit, they really did listen," said Martin Eakes, CEO of the Center for Responsible Lending. "This could potentially hundreds of millions of dollars staying in customers' accounts instead of going toward fees."
The bank is also eliminating two smaller fees as well. It will no longer allow customers to overdraft their accounts at the ATM and will eliminate a $12 fee it charged customers when the bank automatically moved money from one account to another to avoid an overdraft, often moving money from a long-term savings account into the customers' primary checking.
"For many big banks, overdraft fees are still the steady, reliable, predictable, easy revenue that shareholders love," said Rohit Chopra, the CFPB's director, in December.
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