Why Biden Is Cracking Down on Bank Overdraft Fees: QuickTake

Consumer advocates have long complained that US banks and credit unions charge exorbitant overdraft fees to vulnerable customers. Pressured by the Biden administration’s financial watchdogs, the biggest banks have taken voluntary steps to reduce their overdraft fee revenue in recent years. But the White House wants to go further and is proposing restrictions that could make a more significant dent in the billions of dollars that big banks generate from overdraft fees.

1. What are overdraft fees?

Overdraft fees were created in an era when most consumers paid their bills by sending checks in the mail. Making payments that way ...