Starting July 22, Chase will stop charging customers overdraft fees for purchases of $5 or less, according to a customer notice obtained by Business Insider.”We’ll no longer charge you an Insufficient Funds Fee, Returned Item Fee, or Overdraft Protection Transfer Fee,” the letter, which was included in customer statements, said.
Currently, when a Chase customer overdraws their account by any amount, they get hit with a $34 fee.
The move expands on the bank’s current policy of not charging such fees when an account is overdrawn by $5 or less at the end of a business day.
But more significantly, it represents a win for consumers, who’ve grown frustrated with bank’s unsavory overdraft practices in recent years. According to BI reporter Mandi Woodruff, we shelled out nearly $30 billion for overdraft fees in 2011, and between $99 and $370 for daily overdraft charges in that same year.
The median overdraft fee hasn’t budged from $35, but the fees have not stopped there. The Pew Safe Checking in the Electronic Age Project found that consumers were being charged so-called “sustained” fees on top of unpaid overdraft charges, which work like compounding interest.