Answer:
Recurring debit card transactions -- for which a consumer gives a standing authorization to a merchant or business to charge payments to -- are not covered by the prohibition against overdraft fees without opt-in in Regulation E. If you have properly disclosed under Regulation DD Section 230.4(b)(4) that an overdraft fee could be triggered by such a debit card transaction, you can charge a fee just as if the item had been a check or ACH item.
Some merchants make life easier for you by setting a flag in the transaction record to indicate the transaction is recurring. If you receive that information, and can use it to automate your categorization of the transaction as not being subject to the Reg E rule, things can go easily. Otherwise, you'd have to look at history in the account to see if the transaction is a repeating one.
First published on BankersOnline.com 10/3/11
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