Removing Barriers Blog

CUNA Continues to Educate the CFPB on Overdraft Protection
Posted December 01, 2016 by CUNA Advocacy

The CFPB has included overdraft services on its rulemaking agenda several times over the past few years, including on the recently released Fall 2016 agenda, which indicates pre-rule activity on overdraft in January of next year. It also published a White Paper of Initial Data Findings concerning overdraft services in 2013 and a subsequent Data Point document in 2014, both of which only analyzed data from large banks and did not include credit union account information.  

Since that time, and with a strong focus over the past two years, CUNA has made it a top priority to educate the CFPB further about how credit union members use overdraft services. Credit unions have highlighted that consumers want this protection and it can sometimes be their best or only option during times of need. CUNA has urged the CFPB not to move forward with any new regulations for overdraft services for credit unions. 

Last year, CUNA held an overdraft summit, where credit unions from around the country came to Washington to meet with the CFPB and explain how their members use overdraft services, and why some of the CFPB’s ideas surrounding this issue need to be revaluated. CUNA and the Leagues also held many other meetings with the CFPB in 2016 focused on overdraft, some of which took place at GAC last March. GAC also featured a panel of experts discussing overdraft policy and the small dollar loan rulemaking, and how both could impact credit unions. 

CUNA expects the CFPB may release additional research concerning overdraft in early 2017. In particular, we think CUNA and the Leagues’ efforts to educate the CFPB about overdraft services have been influential in forcing the Bureau to study any issues further. 

With the potential change in CFPB leadership in the next few months, and the definite change by 2018, we are cautiously optimistic that the Trump Administration will take a more balanced approach to overdraft services. President-elect Trump has identified removing regulatory burdens on community financial institutions as a priority and we will continue to advocate that the CFPB not issue a rule that could inhibit members’ access to this service.