WASHINGTON, D.C. — Today, the Consumer Financial Protection Bureau (CFPB) announced a proposed rule to stop new junk fees on bank accounts. The rule would stop banks and other financial institutions from utilizing a potential junk fee: fees on transactions declined right at the swipe, tap, or click. The proposed rule would prohibit non-sufficient funds (NSF) fees on transactions that financial institutions decline in real time. These types of transactions include declined debit card purchases and ATM withdrawals, as well as some declined peer-to-peer payments.
The CFPB’s proposal is part of the agency’s proactive approach to protect consumers, and it would cover banks, credit unions, and certain peer-to-peer payment companies. This move is the most recent in the Biden administration’s whole-of-government approach to protecting consumers from corporate exploitation.
In response to the announcement from the CFPB, Demand Progress Education Fund Corporate Power Director Emily Peterson-Cassin issued the following statement:
“Junk fees cost Americans billions of dollars every year, but amount to almost pure profit for banks. It’s an extractive and unfair system. With this newly proposed rule, and the overdraft rule last week, the CFPB is showing its commitment to protecting everyday people and restoring fairness to the banking system. We look forward to providing comments on this critical rulemaking. We know that banks will do everything in their power to hold on to these revenue sources by attempting to water down the proposed rules. Despite these attacks, we hope that the CFPB will maintain these important protections for consumers.”