A bill in the House, HR 4277, the Overdraft Protection Act of 2021, would increase protections for bank customers against certain practices that banks do with overdrafts. Banks frequently charge as much as $35 per overdraft check.
Each financial institution that offers overdraft coverage for accounts must disclose overdraft coverage fees. It must also disclose that the consumer’s transaction may be declined if there are insufficient funds and the consumer will not be charged if such transaction is declined.
A financial institution must provide certain other disclosures regarding its overdraft protection program, including prompt notification of the account’s overdraft status. The bill limits the number of fees a consumer may be charged each month and year.
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