CFPB Proposes Rule to Cut Bank Overdraft Fees, Biden Asserts Families Could Save $3.5 Billion Annually


File - A customer makes a transaction at an automatic teller machine in Los Angeles on March 27, 2023. The cost to overdraw a bank account could drop to as little as $3 under a proposal announced by the White House, the latest move by the Biden administration to combat fees it says pose an unnecessary burden on American consumers, particularly those living paycheck to paycheck. (AP Photo/Richard Vogel, File)
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The Consumer Financial Protection Bureau (CFPB) has unveiled a proposed rule this week aimed at alleviating the burden of bank overdraft fees for millions of Americans. According to the CFPB, a loophole would be closed in the Truth In Lending Act that allows the exemption of the fees.

President Joe Biden, championing the cause, asserted that the new rule could slash the average overdraft fee by more than half, potentially saving the average American family approximately $150 annually.

“That would add up to save families $3.5 billion every year. Unfortunately, some Republicans in Congress continue to defend these exploitative fees,” the President said.

“When companies sneak hidden junk fees into families’ bills, it can take hundreds of dollars a month out of their pockets and make it harder to make ends meet. That might not matter to the wealthy, but it’s real money to hardworking families—and it’s just plain wrong,” Biden stated.

According to the CFPB, over 23 million households grapple with overdraft fees each year. The proposed benchmarks of $3, $6, $7, or $14 for overdraft fees aim to establish fair and transparent standards in the financial landscape.

Click play to listen to the AURN News report from Jamie Jackson:

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