CFPB Overdraft Rule Overturned—How to Stay Ahead with a Better Strategy
Categories:
The House voted to overturn the CFPB’s final rule that would have capped overdraft fees at $5 for large financial institutions. With the Senate already passing a similar resolution, the measure now heads to the President’s desk for final approval.
While this development may ease some federal pressure, it doesn’t mean financial institutions should hit pause on strategic planning. State-level oversight continues to evolve, and consumer expectations around transparency and fairness remain high.
To help community banks and credit unions navigate this shifting landscape, we recently hosted a timely webinar: What’s Next for Overdrafts? A Regulatory and Strategy Update
Key Takeaways from the Webinar
- Even before Congress acted, the writing was on the wall. During the live session, our experts discussed the expected repeal of the CFPB’s overdraft rule targeting large financial institutions. Later that day, the House passed the CRA resolution—setting the rule on a fast track to repeal.
- Repeal isn’t a free pass. As Cheryl Lawson noted, removing the rule doesn’t mean institutions can go back to the status quo. Fee transparency, fairness, and consumer-first strategies remain in the spotlight—especially from advocacy groups and the media.
- Pressure to modernize is coming from the market, not just regulators. Institutions of all sizes are reassessing their overdraft programs in light of shifting expectations from consumers and competitors.
- Now is the time to lead with clarity and consistency. Even without Regulation Z requirements, clear disclosures, strong staff training, and documented processes are essential to staying compliant and earning trust.
- Strategic institutions won’t wait. The most resilient banks and credit unions are using this moment to strengthen internal oversight, reduce risk, and build account holder loyalty—rather than waiting for the next regulatory wave.
Watch the webinar replay to gain more insights and stay informed:
Watch On Demand
At ADVANTAGE, we help community banks and credit unions navigate regulatory complexities while maintaining overdraft programs that balance compliance, revenue sustainability, and consumer value. Our team offers expert guidance on structuring responsible overdraft services that align with current expectations while preparing for future shifts in regulation. Contact us to request a complimentary program review.
To subscribe to our news and updates, visit advantage-fi.com/newsletter.
