Business

Bank of America eliminates bounced check fee and cuts overdraft charges

Bank of America said in a press release Tuesday that the end of the bounced check fee will go into effect next month. The overdraft fee reduction will start in May.

Bank of America said that once all of these latest changes take effect, the bank will end up lowering its overdraft fee by 97% from 2009 levels.

“Over the past decade, we have made significant changes to our overdraft services and solutions, reducing customers’ reliance on overdrafts, and providing resources to help customers manage deposit accounts and general finances responsibly,” said Holly O’Neill, Head of Retail. Banking for Bank of America, in version.

Bank of America’s move comes just over a month later capital one (memory)The country’s sixth-largest consumer bank by assets said it would stop penalizing customers for taking more cash or writing checks for more money than they have in their accounts.
Bank of America is the second largest bank in the United States, only behind c. B. Morgan Chase (JPM).
Smaller banks like Ally and digital financial only company Alliant have also recently eliminated overdraft fees.
at the same time. PNC (PNC)The country’s seventh-largest bank launched a so-called low cash mode last year that makes it easier for customers to manage their accounts on their smartphones in order to avoid fees.
Overdraft fees have been a lucrative, but controversial, source of income for banks. Regulators have argued that those who can afford the fees the least, and the poorest in the country, often end up paying the most.

Finish “Offering Overdraft?”

The Consumer Financial Protection Bureau said in a statement last month that banks took in nearly $15.5 billion in overdraft fees in 2019 — and that 40% of the fees generated by major banks were brought in by JPMorgan Chase, BofA and Wells Fargo (WFC).

Senator Elizabeth Warren criticized JPMorgan Chase CEO Jamie Dimon last year for her fee, referring to him as the “star of the overdraft show.”

But JPMorgan Chase told CNN Business in December that it had already taken some action on overdraft fees and insufficient funds fees.

Big banks are booming.  Now here comes the profits

“We have eliminated the insufficient funds fee and significantly increased the amount a customer can withdraw before the overdraft fee is charged,” Elizabeth Seymour, a spokeswoman for the bank, said last month. “These changes reflect our ongoing efforts to provide the best products and the most competitive services that our customers want.”

The bank also said in December that starting this year, it will give customers until the end of the next business day an opportunity to boost balances so they can avoid overdraft fees from the previous day.

JPMorgan Chase customers will also have direct access to deposited payroll checks up to two business days early.

But even if the big banks eliminate many overdraft fees, they do just fine without them. Financial stocks are up so far this year and have risen sharply over the past six months thanks to higher long-term bond yields, which are helping to make mortgages and other loans more profitable for banks.
JPMorgan Chase, Wells Fargo, and City Group (c) All fourth-quarter earnings will be announced on Friday. Bank of America announces its latest results next week.

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