In November 2009, the FRB published a final rule prohibiting an institution from charging an overdraft fee for ATM and one-time debit card transactions, unless the institution obtains affirmative consent and opt-in and gives written notice. An institution must provide the consumer with a written or electronic opt-in notice segregated from other information, provide a reasonable opportunity to opt in, obtain an affirmative opt in and provide the consumer with written confirmation of the opt in and a statement of the consumer’s right to revoke. The rule will become effective on July 1.
On May 28, the FRB issued a final clarification that the overdraft prohibition applies to all institutions, even an institution that has a policy of declining authorization. That means that, notwithstanding the absence of the consumer’s opt in, an institution may pay overdrafts so long as an overdraft fee is not imposed for doing so. Some issuers have already announced that they will no longer charge overdraft fees. Furthermore, on April 29, the OTS issued proposed overdraft guidance limiting aggregate overdraft fees and requiring new overdraft disclosures.