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Bank charges add further pain to the pandemic-induced woes of some Americans. In 2019, according to the Center for Responsible Lending, major banks collected more than $ 11 billion in overdraft fees from their customers, with 9% of customers paying more than 80% of the fees. For the first nine months of 2020, clients of major banks paid $ 6 billion in overdraft fees, according to Rebecca Borne, a researcher at the non-profit organization, which advocates better treatment of consumers by financial institutions.
The total amount of penalties the bank’s customers paid in 2020 might end up being lower than last year, but since such a large amount of penalties are paid by such a small subset of customers, the the impact of these charges on their finances will most likely be much worse this year.
Other than temporary truces that some banks have entered into with their customers around stimulus checks, banks have not changed their overdraft policies during the pandemic, Ms Borné said. “Charging unreasonably high fees, multiple fees per day, extended fees, and other practices that manipulate fees to maximize fees – these practices hurt those who have difficulty the most,” she said.
On Christmas Eve, Andrew Shorts, an artist living in Ogden, Utah, scrambled to pay his electric bill so he didn’t lose power and heat. Mr. Shorts, who does murals and graphic design projects for local businesses, has been locked out of his account at Zions Bank, a Salt Lake City-based lender, since a rapid fire of automatic deductions for them. household bills this fall increased her balance by $ 150. in negative territory.
When he called Zions two days before Christmas, a rep told him he should probably pay the bank what he owed him and settle for the rest. The bank changed its policy after President Trump signed the stimulus bill on Tuesday. A spokesperson said Zions would zero all negative balances down to $ 2,000 for 30 days to allow customers to get their stimulus money.
Mr. Shorts described the $ 600 stimulus payment as “the equivalent of a pool noodle while my wife, child, myself and my now crippled business drown in the open sea.” But he still wants the money. In the meantime, he’s gathered just enough to pay his electric bill.
On the day Congress passed the latest stimulus bill last week, Misha Roberts, a 26-year-old student at Ohio State University, couldn’t bring herself to log into her account. PNC line and find the balance. She knew the negative amount was between $ 1,200 and $ 1,700, thanks to a combination of basic expense bills she couldn’t afford, which were automatically deducted from her account, and overdraft fees.
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