PROVIDENCE – Bank of America Corp. has lost nearly all of its overdraft fee revenue after implementing a new policy that significantly reduces charges to customers who overdraft their accounts, according to the Associated Press.
The banking giant was among a slew of national and regional banks that moved to waive or reduce overdraft fees in recent years, spurred by competition from fintech firms and a new attitude in Washington, D.C. Earlier this year, Bank of America announced plans to cut its overdraft fees from $35 to $10 while also getting rid of the transfer fee for its overdraft protection service.
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Since starting these changes in June, the company has seen its overdraft revenue cut by 90%, CEO Brian Moynihan told AP.
Bank of America joins several other financial institutions in relaxing overdraft fees, including JPMorgan Chase & Co., Citizens Bank and Santander Bank, PBN has reported.
For years, Bank of America was cited as one of the top collectors of overdraft fees, with more than $1 billion in revenue from these charges last year, AP reported.
In addition to decreasing the fees charged for overdraft accounts, Bank of America has also expanded offerings for accounts that do not have overdraft fees, with half of accounts now available with this feature.
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
