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CFPB Unveils Overdraft Disclosure Prototypes
Monday, August 7, 2017 6:40 AM

On Friday, the Consumer Financial Protection Bureau released new overdraft disclosure prototypes meant to improve those used by financial institutions, including credit unions, to help consumers better understand the risks and costs of opting into overdraft coverage.

The CFPB released four one-page prototype model forms that are now being tested more widely. In prepared remarks, CFPB Director Richard Cordray said the bureau is not proposing any regulatory amendments on this issue, but is considering new overdraft regulations. He said the CFPB is in the "pre-rule stage," with "no timing stated for when a rule may be proposed."

Along with the overdraft disclosure prototypes, the CFPB last week also released a report on the topic, which found that those who opt into overdraft coverage typically pay substantially more in overdraft fees. The study is based on data from several large banks that the CFPB said account for more than 40 million consumer checking accounts.