Senate Banking leaders issue letters calling for consumer relief
A group of U.S. Senators led by Senate Banking Committee Chair Sherrod Brown of Ohio issued a series of letters calling on major U.S. banks to eliminate overdraft fees.
“Financial institutions should do all they can to ensure working families keep their hard-earned money by significantly reforming their overdraft practices…” wrote the Senators. “These fees not only drain bank accounts, but also push consumers out of the banking system and into the arms of unscrupulous and unsupervised lenders who are all too willing to overcharge them for similar services. The result is that millions of Americans are underbanked or unbanked.”
In addition to Brown, the letter was joined by Senators Chris Van Hollen of Connecticut, Raphael Warnock of Georgia, Cory Booker of New Jersey, and Jack Reed of Rhode Island.
The letters were sent to the following banks:
Charles Schwab, JPMorgan Chase, PNC Financial Services Group, TD Group, Truist Financial Corporation, U.S. Bancorp, and Wells Fargo.
In their letter, the Senators noted:
Overdraft and NSF fees are overwhelmingly borne by those Americans already living paycheck to paycheck. The Consumer Financial Protection Bureau (CFPB) found that nearly 80% of overdraft-related fees are charged to only 9% of accounts, who tend to carry low balances— averaging less than $350—and have relatively low monthly deposits. All told, the average consumer with overdraft coverage pays $260 in overdraft and NSF fees each year.
These fees not only drain bank accounts, but also push consumers out of the banking system and into the arms of unscrupulous and unsupervised lenders who are all too willing to overcharge them for similar services. The result is that millions of Americans are underbanked or unbanked.
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