The PNC Financial Services Group, Inc. PNC joins other U.S. banks in removing non-sufficient fund (NSF) fees. As part of its efforts to enhance the financial well-being of its customers, PNC recently announced that it would no longer charge its consumer deposit account customers NSF fees.
NSF fee is a charge imposed on customers when their checks bounce or when automated withdrawals lead to an overdraft in their accounts. The customers generally do not have the funds to cover a transaction or purchase. Hence, the removal of such fees elevates customers’ financial strength.
Alex Overstrom, the head of retail banking for PNC, stated, “As a Main Street bank, PNC is focused on building a platform that empowers the financial well-being of its customers. Over the last several years, we've made significant enhancements to our overdraft solutions, all of which are designed to help our customers and give them better control of their financial future. Eliminating NSF fees on consumer deposit accounts is just another way we are helping our customers strengthen their financial wellness.”
Of late, banks have been facing increased scrutiny from regulators and lawmakers for charging overdraft and other fees to consumers. Several U.S. consumer banks have been asked to eliminate all consumer overdraft fees to safeguard customers. PNC’s actions align with such requests and bode well for the company in the long run.
Notably, PNC has been one of the first financial institutions to take a major step in addressing overdraft fees. In April 2021, the company launched Low Cash Mode, a cornerstone feature of its Virtual Wallet Spend account, which provides consumers with real options for avoiding overdrafts, while maintaining overdraft availability for those who need to make payments during temporary cash shortfalls.
With the launch of the Low Cash Mode, PNC has already eliminated NSF fees for customers with Virtual Wallet Spend. With the latest move, the company’s additional personal checking account types will benefit.
Other Banks Taking Similar Steps
Several banks, including Bank of America BAC and Citigroup C, have stopped charging NSF fees and overdraft fees.
This January, Bank of America announced changes to its overdraft services, including plans to do away with NSF fees, effective February, and lower overdraft fees to $10 from $35, beginning in May. The company said that it would also remove transfer fees associated with its Balance Connect for overdraft protection service in May.
Since 2010, BAC has taken several steps to “empower its consumer and small business clients to bank with greater confidence and reduce overdraft usage.” These efforts have substantially lowered fees related to overdrafts.
In February, Citigroup announced that it would completely terminate overdraft fees, return item fees and overdraft protection fees by this summer, making it the largest U.S. lender to do so.
Citigroup’s overdraft fee collection has been among the lowest when compared with its peers. Other than a consumer-friendly overdraft policy, the banking giant continues to expand access to banking products and services, making banking more financially inclusive for underserved communities.
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