Charging Per Overdraft

Question: We currently have a daily limit on the number of overdrafts we charge but are going to begin charging for each overdraft occurrence, regardless of the number.  How do you feel regulators will look at this practice and what should we tell management?

 

Answer: First off, unless you had an opt-in under Regulation E for ATM and one-time debit card transactions, you can’t just begin charging for them.  So, you will want to ensure your system is set up correctly as to what you can and cannot charge for.  Your management will likely need to be prepared to answer questions on why the limit was removed and have information ready on how the change has impacted your customers.

 

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Published
2019/05/24
Jerod Moyer

Jerod Moyer

Jerod is the leader of Banker’s Compliance Consulting’s training productions. He is a nationally recognized speaker. Whether it’s a conference, seminar, school, webinar or luncheon, it’s easy to stay engaged when he presents due to the amount of passion and energy he brings to each and every compliance topic. Jerod has spoken on behalf of the American Bankers’ Association, BankersOnline, many state banking associations, private compliance groups and financial institutions. He is a Certified Regulatory Compliance Manager (CRCM) and BankersOnline Guru. Jerod likes to spend his time (between reading regulations and producing compliance training!) relaxing at the lake with his wife and three children, following their activities or engaged in something sports-related!

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