Nearly 90 percent of U.S. consumers are pleased with their bank and find overdraft protection valuable, according to a recent Morning Consult study undertaken on behalf of the American Bankers Association.
The study, undertaken in mid-February and released March 8 during the American Bankers Association’s Washington Summit, included a national sample of 2,210 adults. “Consumers are clearly happy with their bank, which reflects our industry’s core commitment to helping customers, clients and communities thrive,” said Rob Nichols, ABA president and CEO. “This new survey data show that consumers appreciate and understand the wide array of banking products and services at their disposal.”
According to the study, consumers support banks’ current overdraft fee practices: Nine in 10 said their bank’s overdraft protection is valuable, and three in four who had paid an overdraft fee in the past year were glad their bank had covered that payment, rather than declining or returning it. Eighty-three percent said their bank is transparent about disclosing fees, and more than 60 percent say that account fees charged by their bank are reasonable.
Those findings come as many of the largest U.S. banks have significantly changed or altogether ended their overdraft fees: Bank of America no longer charges such fees and instead declines transactions when accounts could be overdrafted. Huntington Bank has a 24-hour grace period, and PNC’s Low Cash Mode offers no non-sufficient funds fees and a maximum of one $36 overdraft item fee per day.
Some in Congress have moved to curtail or eliminate overdraft fees. U.S. Sens. Cory Booker (D-N.J.) and Elizabeth Warren (D-Mass.) reintroduced legislation last August that would ban overdraft fees on debit card transactions and ATM withdrawals, and limit fees placed for checks and recurring payments. Still, according to the Morning Consult study, a majority of consumers say they would oppose rather than support a government proposal to prevent banks from offering overdraft protection (54 percent to 26 percent, respectively).
“Consumers enjoy a wide range of choices when it comes to financial products and services, and that’s especially true when it comes to overdraft programs,” Nichols said. “What this survey tells us is that Americans value and appreciate overdraft protection, and they understand it’s a helpful service that comes at a reasonable cost. Banks remain committed to ensuring their customers understand and make informed choices about their overdraft options.”
On March 9, Acting Comptroller of the Currency Michael Hsu urged banks to shift from traditional overdraft programs. To Hsu, banks should tailor their overdraft programs — potentially allowing for a 48-hour grace period, or having a maximum overdraft amount — based on the needs of their customers
Consumers also gave cannabis banking high marks: 65 percent support allowing cannabis businesses to access checking accounts and business loans in states where cannabis is legal. Only 15 percent oppose the option. “Consumers clearly agree that now is the time to resolve the ongoing conflict between state and federal law so banks can serve legal cannabis and cannabis-related businesses,” Nichols said. “Doing so will help banks meet the needs of their communities while enhancing public safety, increasing the efficiency of tax collections and improving the financial transparency of the cannabis industry.”