"Biden Administration's Proposal to Cut Bank Overdraft Fees Could Save Consumers Billions"

The Biden administration has proposed a new rule to curb bank overdraft fees, which currently amount to about $9 billion annually. The rule, if approved, would take effect in October 2025 and apply to banks and credit unions with more than $10 billion in assets, treating overdraft programs as credit programs and imposing limits on fees. The move aims to protect financially vulnerable individuals and promote fair competition, but it faces a regulatory approval process and potential legal challenges from banks. Despite concerns about potential fee increases in other areas, some banks have voluntarily changed their overdraft fee policies, indicating that profitability without abusive practices is possible.