Newsroom
August 24, 2014
Mystery shoppers pan banks' overdraft info
Aug. 6, 2014 – A group of consumer advocacy groups sent "mystery shoppers" to 39 bank branches to test the accuracy of information given to consumers about overdraft products and services, and found that the information was inconsistent and often incorrect.
The organizations – the California Reinvestment Coalition, the New Economy Project, Reinvestment Partners and the Woodstock Institute – conducted 64 visits at branches located in Chicago, Durham, N.C., Oakland, Calif., and New York City.
The overall findings, according to the resulting study, were that banks across the board provided explanations of overdraft programs that varied from branch to branch and employee to employee – resulting in unclear and incorrect information. The mystery shoppers found that employees did not make clear how overdraft fees were triggered, or how the opt-in requirement for ATM and debit courtesy overdraft works. The study also found that branches in predominantly non-white neighborhoods had longer wait times and fewer employees available to help customers.
As a result of the study findings, the groups made recommendations to CFPB and banking regulators, including that they ban overdraft fees at ATMs and for debit-card transactions.
CFPB listed overdraft regulation as being in the "prerule stage" in its Spring 2014 regulatory agenda and has indicated that possible areas of concern include opt-in processes, fee structures and transaction posting order.
A NAFCU Economic & CU Monitor survey last year found that 98 percent of survey respondents charge overdraft fees, with a median fee of $25. However, 94 percent of these will reverse charges on a case-by-case basis, and nearly 70 percent of respondents contact members who repeatedly incur overdraft charges.
The organizations – the California Reinvestment Coalition, the New Economy Project, Reinvestment Partners and the Woodstock Institute – conducted 64 visits at branches located in Chicago, Durham, N.C., Oakland, Calif., and New York City.
The overall findings, according to the resulting study, were that banks across the board provided explanations of overdraft programs that varied from branch to branch and employee to employee – resulting in unclear and incorrect information. The mystery shoppers found that employees did not make clear how overdraft fees were triggered, or how the opt-in requirement for ATM and debit courtesy overdraft works. The study also found that branches in predominantly non-white neighborhoods had longer wait times and fewer employees available to help customers.
As a result of the study findings, the groups made recommendations to CFPB and banking regulators, including that they ban overdraft fees at ATMs and for debit-card transactions.
CFPB listed overdraft regulation as being in the "prerule stage" in its Spring 2014 regulatory agenda and has indicated that possible areas of concern include opt-in processes, fee structures and transaction posting order.
A NAFCU Economic & CU Monitor survey last year found that 98 percent of survey respondents charge overdraft fees, with a median fee of $25. However, 94 percent of these will reverse charges on a case-by-case basis, and nearly 70 percent of respondents contact members who repeatedly incur overdraft charges.
Share This
Related Resources
Add to Calendar 2024-05-02 14:00:00 2024-05-02 14:00:00 Mastering Resilience in Incident Response Plans About the Webinar An Incident Response (IR) plan is crucial for guiding credit unions through major incidents efficiently and effectively. However, many IR plans lack resilience, making them less adaptable to the evolving threat landscape. Join us for our webinar Mastering Resilience in Incident Response Plans where DefenseStorm cyber experts Elizabeth Houser and James Bruhl will delve into the importance of resiliency within cybersecurity IR plans. Don’t miss out on the opportunity to learn how to: Ensure IR plan accessibility so that all team members with assigned roles are prepared for effective incident response. Conduct efficient and regular reviews to ensure roles and responsibilities are current, tools are relevant, and compliance requirements are met. Implement and utilize tabletops to regularly test the effectiveness of your IR plan. Enhance preparedness, efficiency, and confidence among responders. View On-Demand Web NAFCU digital@nafcu.org America/New_York public
Mastering Resilience in Incident Response Plans
preferred partner
DefenseStorm
Webinar
Add to Calendar 2024-04-30 14:00:00 2024-04-30 14:00:00 State of Consumer Credit: How Behaviors have Shifted and Trends in US Bankcard Benchmarks About the Webinar In an era marked by volatility and evolving credit trends such as historic inflation and the rise of BNPL, credit unions must adapt to mitigate risks effectively. Join the experts at FICO in exploring how to leverage FICO Scores to enhance competitiveness while maintaining stability and compliance. Key Takeaways: Learn about the latest in consumer credit behaviors and score distributions since the pandemic Take a closer look at major US bankcard trends in comparison to the credit union industry, such as average card spend, balance, missed payments and more. View On-Demand Web NAFCU digital@nafcu.org America/New_York public
State of Consumer Credit: How Behaviors have Shifted and Trends in US Bankcard Benchmarks
preferred partner
FICO
Webinar
Add to Calendar 2024-04-25 14:00:00 2024-04-25 14:00:00 ChatGPT: What AI can do for you! ChatGPT has been created with one main objective – to predict the next word in a sentence, based on what's typically happened in the gigabytes of text data that it's been trained on. Did you ever hear of the saying, “People fear the unknown?” Artificial intelligence scares people, but it is the future, and you need to understand the tools and resources it offers. It’s also about saving time, that’s what technology and in this case, artificial intelligence can do for you. If you want to save time and have a better quality of life, this training is for you. Once you give ChatGPT a question or prompt, it passes through the AI model and the chatbot produces a response based on the information you've given and how that fits into its vast amount of training data. It's during this training that ChatGPT has learned what word, or sequence of words, typically follows the last one in a given context. During this webinar, ChatGPT: What AI can do for you, you’ll discover the background, purpose, usability, and the pros and cons. Don't miss this opportunity! Key Takeaways Learn the background of AI Understand the purpose of AI Identify the pros and cons Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until April 25, 2025Go to the Online Training Center to access the webinar after purchase » Who Should Attend NCRMs Risk titles Education Credits NCRMs will recieve 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public
ChatGPT: What AI can do for you!
Credits: NCRM
Webinar
Add to Calendar 2024-04-25 14:00:00 2024-04-25 14:00:00 Unifying Two Different Executive Benefits Programs About the Webinar In part one we discussed how to retain key positions during a time of transition. In part two, we will look at how to combine executive benefits programs from two different organizations into a single high-performing program. Evaluating each program includes many different facets, from strategy and expense to performance and servicing. This session will provide important considerations, whether or not you have pending M&A activity. Key Takeaways: Is the plan design both retentive and efficient? Is the benefit expense properly mitigated? Does the legal agreement reflect the board’s intent? View On-Demand Web NAFCU digital@nafcu.org America/New_York public
Unifying Two Different Executive Benefits Programs
preferred partner
Gallagher
Webinar
Get daily updates.
Subscribe to NAFCU today.