Chris Van Hollen: “Colleagues, overdraft fees are among the most abusive junk fees in our financial system. The average overdraft is only…”

“Colleagues, overdraft fees are among the most abusive junk fees in our financial system. The average overdraft is only $26 and is usually repaid within a few days, but many large banks charge $35 a fee per overdraft. That works out to an annual percentage of about more than 16,000 percent. So I want you to imagine that you are walking into a 7-Eleven. You are a little short on cash. You want to buy a cup of coffee. You go to the ATM machine. You take out 50 bucks. You buy a $2.50 cup of coffee, but it costs you about $40; and you don't even know it because the bank doesn't tell you. And then the next day you go to buy some groceries. This time you use your debit card, and they charge you another 35 bucks and don't tell you you have overdrawn. Well, these fees fall hardest on families living paycheck to paycheck. Federal law requires that these banks can charge an overdraft fee on these withdrawals only if consumers opt in--if they opt in. But many financial institutions use deceptive tricks and confusing fine print to get consumers to enter into these programs and then do not inform them of the costs. And banks not that long ago made about $30 billion in one year from these overdraft fees. So in 2024, the CFPB issued guidelines requiring banks to show proof that one of our constituents--one of our consumers--actually opted in, and that is what the Trump administration got rid of.”