Capital One Is Kissing Overdraft Fees Goodbye And I May Just Switch Banks
It looks like I’m about to switch banks!
Capital One has announced that it is going to be the first large retail bank to do away with overdraft fees. YIPEE!!
Capital One (COF) made the announcement Wednesday, saying it is getting rid of all fees for overdrafts and non-sufficient funds. It will also continue to allow customers to get free overdraft protection on their accounts.
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That means, when we have the occasional “oops,” we won’t be financially penalized for it.
This goes for accidentally writing checks over the amount of cash we have in the bank or using our debit cards beyond our means.
Hopefully, this will only be the start, and other large banks will follow in step with the precedent set by Capital One.
There are a few smaller banks that have already done away with overdraft and non-sufficient funds fees: Ally and Alliant.
“The bank account is a cornerstone of a person’s financial life,” said Capital One CEO Richard Fairbank in a press release, adding that “Overdraft protection is a valuable and convenient feature and can be an important safety net for families.”
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Banks make a very hefty penny off our unfortunate incidents over overdraft. For instance, in 2019, banks made a collective $15.5 billion in overdraft fees — fees that sometimes mean the difference between making it to the next paycheck for many people.
This could be such a life saver for so many. I mean, it’s never good to write a check for funds that aren’t in our account — but sometimes accidents happen. I’ve accidentally made them, when a bill hits my account that I wasn’t expecting.
Please tell me I’m not the only one here who has had this problem.
Rather than competing on quality service and attractive interest rates, many banks have become hooked on overdraft fees to feed their profit model,” said [Consumer Financial Protection Bureau] Director Rohit Chopra in a press release. “We will be taking action to restore meaningful competition to this market.”
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I applaud Capital One, and hope this is only the start of changing winds in the financial institution game.