The acting head of the Consumer Financial Protection Bureau (CFPB), Raj Date, recently spoke about the priorities of this new regulatory agency, and overdraft fees were cited as one of the group’s top three concerns. That might not be all bad, as financial institutions have to wind their way through more than one regulatory agency’s oversight of these fees. In addition, payday lenders are also on their radar. If the CFPB is able to smooth out the rules across the entire spectrum of short-term credit solutions, that could benefit everyone in the value chain.
“The FDIC wanted banks to contact customers who got dinged with penalty fees six times in a rolling 12-month period. The OCC said banks should monitor customers who overdraw their accounts and determine if they had the means to pay; if not, the office said banks should consider ending the overdraft coverage and closing the account. Banks have said the two sets of marching orders are confusing and could give those banks not regulated by the OCC or FDIC a competitive edge. That’s why the Consumer Financial Protection Bureau decided to step in. Date said that the bureau will review the different sets of marching orders for banks and see which works better for consumers.”