June 14th, 2013
The study found that a consumer’s decision to opt in may have significant ramifications:
--Consumers who opt in end up with more costs: The CFPB study looked at previous heavy overdrafters who declined to opt in when the new federal requirements were implemented in 2010. It found that by opting out these accountholders reduced their overdraft and non-sufficient fund fees, on average, by more than $450 in the second half of 2010.
--Consumers who opt in to overdraft are more likely to end up with involuntary account closures: Negative account balances are a significant contributor to involuntary account closures at many banks and credit unions. The CFPB study found that at some banks in the study involuntary closure rates were more than 2.5 times higher for accounts that had opted in to debit and ATM overdraft coverage.