CFPB Studying Banks' OD Programs

Posted: Jun 22, 2022 | Author: CFPB
CFPB  compliance  overdraft program 

The CFPB has posted a Bureau Blog article, "Measuring the Impact of Financial Institution Overdraft Programs on Consumers," announcing that the Bureau has been piloting a supervision effort to collect key metrics from some supervised institutions regarding the consumer impact of their overdraft and non-sufficient fund practices. More than 20 institutions have been asked for data on five consumer-impact metrics:

  • Total annual dollar amount consumers receive in overdraft coverage compared to the amount of fees charged
  • Annual dollar amount of overdraft fees charged per active checking account
  • Annual dollar amount of NSF fees charged per active checking account
  • Prevalence of frequent overdrafters: the share of active checking accounts with more than six and more than 12 overdraft and/or NSF fees per year
  • Share of active checking accounts that are opted into overdraft programs for ATM and one-time debit transactions

In addition to these metrics, the CFPB is seeking detailed information about entities’ overdraft practices, including how they assess their fees, their grace periods, the dollar thresholds above which fees are assessed, and caps on the number of fees charged per day, or per statement period. The article states that the Bureau intends to use this information to identify institutions for further examination and review. It also plans to provide feedback to each institution, as well as share the information with other regulators.


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