Regulators Say Overdraft Protection Is a Loan in DisguiseBy
Many banks let consumers spend more money than is in their accounts under the name of overdraft “protection.” For a fee—$34 on average—banks front the amount overdrawn, which they then deduct when the consumer next makes a deposit. A few prepaid debit cards allow overdrafts as well, typically for $15 a pop. Banks call this a service. The Consumer Financial Protection Bureau disagrees. In a new set of rules for prepaid cards proposed on Wednesday, the CFPB says charging to overdraft is actually a form of credit.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.
- This $14 Million Atlanta Home With Bunker Is ‘Safest in America’
- GE's New CEO Vows Sweeping Change After ‘Unacceptable’ Report
- These Cities Make NYC Housing Look Dirt Cheap
- Separatists Pledge to Fight On After Spain Moves to Oust Catalan Leaders
- The U.K.'s $86 Billion Pension Problem Is About to Solve Itself