CFPB: Overdraft/NSF Down Nearly 50% Versus Pre-Pandemic Levels

On May 24, 2023, the CFPB published a report providing an analysis of overdraft and NSF fees reported by banks with assets over $1 billion, which have been required to report OD/NSF fee revenue in Call Report data since 2015. Based on the report, data from the fourth quarter of 2022 data suggest over $5.5 billion reduction on an annual basis going forward but fees still totaled $7.7 billion in 2022.

Highlights from the CFPB’s data spotlight report include the following:

  • Overdraft/NSF revenue for the fourth quarter of 2022 alone was approximately $1.5 billion lower than in the fourth quarter of 2019 – a decrease of 48% compared to before the pandemic, suggesting an annual reduction of over $5.5 billion going forward. This decrease suggests average annual savings of more than $150 per household that incurs overdraft or NSF fees; many households that have typically paid a high number of overdraft or NSF fees annually have saved much more.1

  • Even with this substantial reduction, consumers paid over $7.7 billion in 2022 in overdraft/NSF fees.

  • Evidence continues to suggest that financial institutions are not increasing other checking account fees to compensate for reduced overdraft/NSF revenue. Across all reporting banks, combined account maintenance and ATM fees remained flat from 2019 to 2022.

The CFPB said that it will continue to track overdraft/NSF fees and is considering rulemaking activities related to such fees.

The CFPB’s data spotlight report can be found here.

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