New York Gov. Kathy Hochul has signed a
The report is intended to inform the state’s efforts to address excessive finance fees and to make banking more affordable for low-income residents.
"As New Yorkers recover from the economic pains of the pandemic, it is critical that we do everything possible to increase access to affordable banking services," Hochul said in a recent news
The law directs the superintendent of the New York State Department of Financial Services, Adrienne Harris, to examine the total amount of overdraft fees paid in New York state and the geographic distribution of such fees, whether certain communities have high rates of overdraft fees and why, the percentage of overdraft fees that are reduced through negotiations and how institutions disclose consumer rights relating to fee negotiation.
The state’s Department of Financial Services seeks to prevent banks and credit unions from imposing three kinds of “improper or unfair” fees, including overdraft charges when the consumer’s account shows sufficient funds at the time of transaction.
The study is scheduled to be conducted within 12 months and results will be posted on the department’s website.
"I commend Gov. Hochul and the legislature for enacting this legislation and
The law says that overdraft fees cost Americans $12.4 billion and the average national overdraft fee was $24.38 per transaction in 2020.
“Often the bank will assess an account holder an overdraft fee instead of declining the transaction, and while that may be helpful in covering expenses the result undoubtedly causes further financial strain and hardship especially to New Yorkers who live paycheck to paycheck,” the law says.
