Sometime this summer, Citi banking customers no longer will have to worry about paying fees for overdrafts, returned items or overdraft protection.
Citi announced this week that it plans to end such fees over the next few months. According to Citi, it will be “the only top five U.S. bank (based on assets) to completely eliminate these fees.”
Citi is just the latest bank to roll back the fees it charges. Earlier this year, Bank of America and Wells Fargo both announced that they would reduce or eliminate fees when a checking account is overdrawn.
Bank of America has eliminated its $35 non-sufficient funds fee. In addition, beginning in May, the bank’s overdraft fee will fall to $10, down from $35 today. Also in May, Bank of America will end the $12 transfer fee associated with its Balance Connect for overdraft protection service.
Meanwhile, Wells Fargo announced plans to end non-sufficient fund fees, and the transfer fees for accounts enrolled in overdraft protection. The changes were supposed to be in place by the end of the first quarter.
Sometime around the third quarter, Wells Fargo will give account holders a 24-hour grace period before overdraft fees kick in.
Online banks announced similar initiatives last year.
In June 2021, Ally Bank — the self-described largest online bank in the nation — ended its overdraft fees on all accounts.
In December 2021, Capital One announced that it would end overdraft fees and non-sufficient fund fees.
It is likely that other banks soon will follow suit. Commenting on the moves by Bank of America and Wells Fargo at the beginning of the year, Greg McBride, Bankrate chief financial analyst, told MarketWatch that the moves are coming at a time when regulators and lawmakers have put banks under the microscope:
“This will ratchet the pressure up on other large national and regional banks to take similar steps.”
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