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Citigroup is the latest major bank to drop overdraft fees

Citigroup Results
Posted at 11:14 AM, Feb 24, 2022
and last updated 2022-02-24 14:20:19-05

Citigroup is the latest bank to get rid of overdraft fees, making it the largest U.S. bank to eliminate these types of charges.

Overdraft fees, non-sufficient funds fees and overdraft protection fees will be gone by this summer, the bank tells CNN.

The latest announcement by Citigroup is part of a growing trend as more banks drop the controversial fees.

In late 2021, Capital One eliminated its overdraft fees and non-sufficient fund fees for customers.

The bank still provides free overdraft protection.

Other banks like Ally, which only operates online, and Alliant Credit Union have stopped charging customers these fees.

Consumer advocates have long pressed banks to eliminate overdraft fees, which they say targeted people who were already short of money.

In 2020, customers in the U.S. were charged more than $12 billion in overdraft fees, according to data from finHealth.

Most people who end up paying these fees are families who live paycheck to paycheck.

“Overdraft fees are highly concentrated among families living on the edge. One in 12 families in America pay $350 a year in overdraft fees,” said Aaron Klein, Senior Fellow at the Brookings Institution.

More banks are expected to follow the trend.