According to the Associated Press, on July 1st the government will require that banks allow customers to opt out of overdraft protection for debit/credit transactions. This is something I’ve wanted for my dad for ages now, and I think it will help him out greatly. Basically any transaction he attempts to put through with his card that would normally make him overdraft, will instead be denied.
“Under the Fed’s new rule, which will take effect July 1, banks will be required to notify new and existing customers of their overdraft services and give customers the option of being covered. If customers don’t “opt in,” any debit or ATM transactions that overdraw their accounts will be denied, Fed officials said.”
However checks and regular bill payments are not covered by this rule, simply because the majority of people would rather overdraft than bounce a check or a bill (like rent) not get paid. Which makes sense to me, and is probably for the best.
“Many consumers do want checks and regular electronic bill payments to be covered in the event of an overdraft, Fed officials said. As a result, those transactions aren’t covered by the rule.”
Why this has taken so long to come into effect is boggling, but at least it’s finally happening.