Overdraft Fees Are Up

by MB on March 20, 2012

Per Moabs, banks raised overdraft fees by an average of $2.50 per item last year.

The increase is linked to guidance from the FDIC and OCC on overdrafts which in turn cost banks billions in fees. Moab believes the rise in overdraft fees will cost consumers who overdraw their accounts an additional $2 billion per year.

The changes by the FDIC and OCC required banks and other financial institutions to end the practice of automatically adding customers to overdraft programs, and instead required them to opt-in.

This change cost banks a lot more than they will recoup on the new charges. It is estimated that banks took in $29.5 billion in overdraft fees in 2011. This is down considerably from the $37 billion collected in 2009.

You’re not going to find many people shedding tears for the banks, but all customers will see increases in fees to offset this loss of revenue.

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