CFPBProposed Rule
Fees for Instantaneously Declined Transactions; Withdrawal
Finance & Banking
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Summary
The Consumer Financial Protection Bureau (CFPB) is proposing to limit or eliminate fees that banks charge when they instantly reject a payment or withdrawal because you don't have enough money in your account. This rule aims to prevent banks from profiting off declined transactions and protect consumers from unexpected charges.
Key Points
- 1Banks would be restricted from charging fees on transactions that are immediately rejected due to insufficient funds
- 2The rule targets a common practice where banks charge $30-35 per declined transaction, which can add up quickly for people living paycheck to paycheck
- 3This is a proposed rule, meaning the CFPB is opening it for public comment before deciding whether to finalize it
- 4If approved, the regulation would primarily affect commercial banks, credit unions, and other financial institutions that currently collect these fees
- 5The rule reflects concerns that declined transaction fees disproportionately harm low-income consumers who may have smaller account balances
Key Dates
Published
January 14, 2025
This summary is for informational purposes only. It may not capture all nuances of the regulation. Always refer to the official text for authoritative information.
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