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Bank of America to reduce overdraft fees this spring -Breaking

by Mike Robinson

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© Reuters. FILE PHOTO: A Financial institution of America emblem is pictured within the Manhattan borough of New York Metropolis, New York, U.S., January 30, 2019. REUTERS/Carlo Allegri

By Elizabeth Dilts Marshall

NEW YORK (Reuters) – Financial institution of America (NYSE:), the second-largest U.S. financial institution, is decreasing overdraft charges from $35 to $10 beginning in Might, the financial institution stated in a information launch on Tuesday.

The financial institution may also cease charging inadequate funds charges beginning in February, it stated.

The transfer comes amid rising regulatory and congressional scrutiny of such charges. The U.S. Shopper Monetary Safety Bureau (CFPB) stated final month https://www.reuters.com/enterprise/capital-one-eliminate-all-overdraft-fees-2021-12-01 that it’s taking a look at such charges, which it estimates netted banks $69 billion within the third quarter of 2021, and can concern new steerage aimed toward curbing banks’ reliance on them.

Some banks look like making an attempt to get forward of any regulatory intervention. Late final yr, Capital One Monetary Corp (NYSE:) stated it might cease charging accounts for not having ample funds to cowl drafts, and the biggest U.S. financial institution, JPMorgan Chase & Co (NYSE:), stated it might give prospects extra leeway earlier than charging charges.

JPM stated https://www.reuters.com/markets/funds/jpmorgan-chase-reduces-bank-overdraft-fees-bid-customers-2021-12-08 it might give prospects a full day to convey overdrawn accounts as much as zero and would permit prospects to faucet into funds from direct paycheck deposits as much as two days early earlier than charging them charges.

As compared, Financial institution of America will cut back overdraft charges to $10 and is eliminating the switch charge prospects have been charged for utilizing the financial institution’s overdraft safety service.

The financial institution stated these steps, and others it says it took beforehand, will minimize the revenues the financial institution earns from overdraft charges by 97% since 2009.

“We stay dedicated to taking actions that can additional convey down overdraft charges sooner or later and proceed to empower shoppers to drive constructive adjustments to conduct pertaining to overdraft,” Holly O’Neill, president of retail banking at Financial institution of America stated within the information launch.

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