Bank of America gets rid of involuntary overdraft fees
Mar 11th, 2010 by D.J. Rausa
Finally, something that makes sense….
Banks have been making millions of dollars from consumers by simply covering small purchases made with an ATM card when there’s not enough money in the account, then charging big fees for doing so. That is why a little $4 latte can cost you $34 on your bank statement. You charged the $4 when your balance was almost zero, and the bank charged you another $30 to cover the balance.
Come this summer one bank, Bank of America, recently announced that it will no longer cover the price of the purchase if the money is not there. They will simply decline the purchase. Now that makes sense. It is too bad that the bank has to save the customer from themselves, but, in today’s economy, it is necessary.
In the future, I expect this to be a mandated practice for all banks. The only way an overdraft fee can be allowed would be at the election of the customer. I also think that the fees associated with the overdraft protection will be more costly to make up for the lost revenues.
