WASHINGTON–With the revenue stream in its crosshairs, the CFPB has released a new report showing bank overdraft fee income has dropped significantly since the COVID-19 pandemic began, noting that banks have not yet replaced that income with revenue from other sources.
Despite the decline, the CFPB said it doesn’t mean it will drop its plans for regulating overdraft fees.
The Consumer Financial Protection Bureau said the report found overdraft/non-sufficient funds (NSF) fees during Q3 2022 declined 43% compared Q3 2019. That adds up to $5 billion reduction in fees on annual basis, the Bureau stated.
In addition, the CFPB said its study further found:
- Overdraft/non-sufficient funds (NSF) fee revenue was 33% lower over the first three quarters of 2022 compared to the same period in 2019.
- Fees have trended downward in each quarter since Q4 2021.
Focus to Continue
Despite those trend lines, the Bureau said, “At the same time, we have not observed correlating increases in other listed checking account fees, which suggests that banks are not replacing overdraft/NSF fee revenue with other fees on checking accounts.”
The CFPB said in releasing the findings that its focus on OD/NSF fees will continue. “We are considering rulemaking activities related to these fees,” the agency added. “We will also continue to follow other listed account fees to discern to what extent these fees might create barriers to account access.”
The full report can be found here.
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