On November 12, 2009, the Federal Reserve announced new rules that will prohibit banks from charging their customers overdraft fees unless the customer opts in. This means that a consumer who does not opt in will be denied at the register if his account balance does not cover his debit card purchase (instead of being charged upwards of $35 in overdraft fees to complete the purchase, which has been the current practice).
Without permission from consumers who decide to opt in, card issuers cannot charge for overdrafts at retail stores or ATMs. However, the new rules will not cover overdraft fees for checks or for recurring debit card transactions, like payments for utility bills that are set up in advance.
The new rules will take effect on August 15, 2010, for existing accounts, and on July 1, 2010, for new banking accounts.
The Federal Reserve also has a new website that explains what consumers need to know about the new overdraft rules. For more details, visit the Federal Reserve's informational site here.
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