The Fed is going to ban overdraft fees

The Fed is going to ban overdraft fees on ATM and debit-card transactions unless consumers have overdraft protection accounts setup.

Fed bars ATM card overdraft fees

The Feb?

Hopefully they'll fare better than Virgil Starkwell robbing a bank with a gub.

I wish the Mar would ban the Ides!

Will be interesting to see what retaliatory steps the banks take to recoup this lost revenue stream IF the ban goes through. It will probably be similar to the preemptive rate jacking the cc industry is doing in response to their new legislation.

They should ban excess profits!

Stuff like this makes me kind of angry. Now the banks will take adverse action that will affect a much larger percentage of the population, including FWF members to recoup the lost revenue instead of just making easy money off some retards.

lgyeresi said: Stuff like this makes me kind of angry. Now the banks will take adverse action that will affect a much larger percentage of the population, including FWF members to recoup the lost revenue instead of just making easy money off some retards.
Although from the sound of it, they aren't really banning overdraft fees. They're making overdraft protection an opt-in system. I imagine the banks will still convince PLENTY of people who aren't good at handling money to take their overdraft offer.

motsuka said: End of Free Checking?

citi is doing it.

dont worry, dave hason will come in and tell us how everyone paying for checking is better for the country then just the deadbeat over drafters doing it.

Interesting the Fed would do this. Considering they are owned by the member banks and such. Must be a reason...

I still don't understand why you can't have a debit card, attempt to make a purchase with it, if not enough money, then transaction fail.

That's the product I want and the "retards" want. Why won't the market give it to us?

tyrone3971 said: I still don't understand why you can't have a debit card, attempt to make a purchase with it, if not enough money, then transaction fail.

That's the product I want and the "retards" want. Why won't the market give it to us?
ING Direct's checking account is that way. There are no overdraft or NSF fees. While they automatically open an overdraft LOC for you, you can close it (ask them to reduce it to 0), and if used they only charge the interest. If you exceed that, I assume transactions will be declined, as there are no NSF fees.

comptalk said: Interesting the Fed would do this. Considering they are owned by the member banks and such. Must be a reason...

Perhaps it has something to do with the fact that Congressional legislation to control these banking overdraft fee practices is imminent and the public outrage over these practices (and the fact that the fees are a substantial source of bank revenues). Given those facts, the Fed's failure to regulate in a manner to control these practices makes the Fed look all the more in bed with the banks if fails to assert its authority to regulate these practices.

Even if that is true, it seems pretty transparent to me.

hell, this was one of the only fees that actually makes sense at a bank.

i was charged $30 yesterday to cancel a check that got lost in the mail. they wouldn't waive it, so i told them to screw the payment stoppage and i'll just risk being a month ahead on my car loan and not being charged 5% of the value of my check.

Anyone dumb enough to be paying overdraft fees will just squander their money another way. A fool and his money are soon parted.

tyrone3971 said: I still don't understand why you can't have a debit card, attempt to make a purchase with it, if not enough money, then transaction fail.

That's the product I want and the "retards" want. Why won't the market give it to us?I got Wamu to do this for me back in the day. From what I've heard, Chase may not allow this 'feature' so it may have been 'disabled' by Chase.

I think a lot of the online banks do this too. I'm fairly certain that my Fidelity mycash account will reject any transaction when they know I don't have available cash or cash equivalents in a linked account.

While I agree that the majority of overdraft fees are caused by people not keeping solid track of their accounts, at least this will tone down the practice many banks do of holding deposits for a day or two in order to rack up overdraft fees.

Up till now people complained about being charged a fee to use money they don't have. I imagine now the masses will complain about not being able to use money they don't have when their transactions fail because they're short $15.

ash78 said: Gman476 said: I hate the feb with their damned black history month.From the looks of my account statements, it's always red history month.Lately, yes, it is Red History Year.

dbavaria said: Up till now people complained about being charged a fee to use money they don't have. I imagine now the masses will complain about not being able to use money they don't have when their transactions fail because they're short $15. And in response to these complaints, the banks will hand them an opt-in form to sign up for the $35 per transaction overdraft service. Problem solved.

And (who knows?) maybe some enterprising banker will invent an alternative to the debit card specifically designed for people to buy things when they don't have money in their accounts. It can use the same payment terminals and transaction processing networks as debit cards. They can call it something like a "credit card" or something like that.

dbavaria said: Up till now people complained about being charged a fee to use money they don't have. I imagine now the masses will complain about not being able to use money they don't have when their transactions fail because they're short $15.

Do you have any evidence that people are going to cry about a transaction being declined because they didn't have the money?

I have two opinions here, neither of which I expect to be popular

1. Call a loan a loan, and regulate it just like every other loan. Let the customer see the APR before they agree to the OD line.
2. I hope the banking industry shrinks to a size that fits a productive purpose in society. Screwing poor ignoramuses does not qualify.

I do wonder how much my bank USAA rakes in OD fees currently. We mostly buy using credit cards, but we own USAA ATM cards that do not allow POS OD, and are charged about 9% apr for checking account OD. Truly a pittance compared to $35 for a couple dollar OD for a day or two other banks are collecting. If USAA is profitable without OD fee crap, I am comfortable forcing other banks to be as competitive as USAA, or to go away.