If your bank has more than $10 billion in total assets, you should be taking a preliminary look at the CFPB's new final rule (announced yesterday) on overdraft fees. It is very much like the proposal the Bureau published in February 2024. FIs with total assets over $10B will have the choice to:

• Cap their OD fee at $5
• Cap their fee at an amount that covers costs and losses
• Disclose the terms of their OD loan just like other open-end credit, treating OD fees as finance charges

The new rule is scheduled to become effective October 1, 2025. There is likely to be litigation that could nullify or alter the rule, given the changes in administration and Congress in 2025.

I am working on posting the rule's changes to the BOL Regulations pages for Regs E and Z, but they can be undone easily if the rule is nullified.

The first lawsuit has already been filed by the CBA, ABA, Mississippi Bankers Association, America's Credit Unions, Arvest Bank, Bank of Franklin, and The Commercial Bank.

it's sure weird how if your bank is greater than $10B it is to be treated as an open-ended credit, but if your bank is under $10B not an open-ended credit at all...

If the rule goes through, no doubt the requirement (or expectation) will trickle down to smaller banks in due time.

Not sure how smaller banks are going to remain competitive, if they are going to charge more. I know some banks have just eliminated overdrafts fees all together.

In California, the asset size of the credit union (no similar rule for banks in CA) won't matter for the new CFPB overdraft rule. New CA SB 1075 that is effective 1/1/2026 "prohibits a credit union from charging an overdraft fee or a nonsufficient funds fee exceeding $14 or the amount set by the federal Consumer Financial Protection Bureau for the fee, whichever is lower." New the CA state law doesn't have an asset size restriction. We are already planning on how we are going to comply with $5 cap in 1/2026.

Any good white papers or summaries on this? Still wading through this, but one point I am still a little fuzzy on is...Is the $5 cap per debit transaction into negative territory, per day, per overdraft event, etc.?

The preamble to the final rules is sort of its own whitepaper and should answer most of your questions. For example:

CFPB’s Proposed Benchmark Fee or Breakeven Standard Under the final rule, overdraft credit offered by very large financial institutions that currently is non-covered overdraft credit could remain non-covered overdraft credit if the per transaction price for such credit were less than or equal to the $5 benchmark fee established by the CFPB.