DFS to conduct study on impact of overdraft fees on consumers

Gov. Kathy Hochul on Friday signed a bill that directs the New York state’s Department of Financial Services to conduct a study of the impact of overdraft fees on consumers, and to submit a report on its findings within 12 months.

According to the bill, the study must include, but is not limited to:

  • the total amount of overdraft fees paid in New York state;
  • geographical distribution of such fees;
  • identification of any communities that have high rates of overdraft fees and the possible reason for such high rates;
  • the percentage of overdraft fees reduced through direct or indirect negotiation; and
  • enumeration of consumer rights relating to fee negotiation.

Last week, DFS issued new guidance for New York-regulated banking institutions in an effort “to promote financial inclusion by prohibiting unfair and deceptive overdraft and non-sufficient funds fee practices,” as reported in the New York Minute.

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