Managing Money :: Banks push lucrative overdraft programs

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Released: August 12, 2010

Banks push lucrative overdraft programs

Source: Tony Pugh, McClatchy Newspapers (Miami Herald)

Hoping to preserve more than $10 billion in annual fees, banks and credit unions are pushing hard for customers to accept costly overdraft protection on their debit and ATM cards. The marketing blitz, which includes letters, e-mails and phone calls, comes on the eve of new consumer protections that are expected to strip much of the profit from overdraft fees.

Beginning Sunday, banks and credit unions no longer can approve and charge penalty fees for one-time debit-card purchases that exceed customers’ account balances unless the account holders have agreed to “opt in,” or accept overdraft coverage. These transactions, along with ATM withdrawals that overdraw accounts, now will be declined for customers who don’t accept the coverage.

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