Why are Banks Cutting Overdraft Fees?

Huntington announces sharp reduction in fees as industry focus shifts

Photo by Christian Wiediger on Unsplash

Columbus, Ohio-based Huntington Bancshares announced this week it will cut the cost of an overdraft fee by about 60% starting in April. The bank also plans to reduce the fee it charges when a customer’s transaction is rejected due to insufficient funds. Both fees will go from a current amount of $36 to a reduced amount of $15.

The move at Huntington comes as major national banks and some regional banks are moving away from overdraft fees altogether.

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The move is being further accelerated by the Consumer Financial Protection Bureau’s (CFPB) notice of intent to regulate the fee practices of the banking industry.

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