Fintech Nexus Newsletter (December 20, 2023): CFPB Reports Looks At Overdraft And NSF Fees

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The CFPB has just released a 90-page report on the use of overdraft and Non-Sufficient Fund fees and it paints a bleak picture for those consumers that are struggling financially.

This is happening even though the CFPB has been attacking these kinds of “junk fees” over the last couple of years.

The report found that many consumers, particularly those with subprime credit scores, use overdrafts as a form of credit. This is despite the fact that often these consumers have less expensive forms of credit available to them.

In January, the CFPB is expected to release a proposal aimed at cracking down on both overdraft and NSF fees.

Even though many banks have eliminated overdraft fees they are still a major challenge for consumers that the CFPB is determined to address.

Featured

CFPB report finds overdraft, NSF services are used as a type of credit

Frequent overdrafters — households that pay more than 10 overdraft fees a year — use the service as a form of credit, the Consumer Financial Protection Bureau said in a report.

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Peter Renton is the chairman and co-founder of Fintech Nexus, the world’s largest digital media company focused on fintech. Peter has been writing about fintech since 2010 and he is the author and creator of the Fintech One-on-One Podcast, the first and longest-running fintech interview series.

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