Bank of America today announced significant changes to its overdraft services, including plans to eliminate non-sufficient funds (NSF) fees beginning in February, and to reduce overdraft fees from $35 to $10 beginning in May. The company will also eliminate the transfer fee associated with its Balance Connect™ for overdraft protection service in May. These and earlier changes over the last decade, together with industry-leading solutions that can help consumer clients avoid overdraft fees – such as the no overdraft fee SafeBalance® account and Balance Assist™ – will lead to overdraft fee revenues being reduced by 97% from 2009 levels.
“Over the last decade, we have made significant changes to our overdraft services and solutions, reducing clients’ reliance on overdraft, and providing resources to help clients manage their deposit accounts and overall finances responsibly,” said Holly O’Neill, President of Retail Banking, Bank of America. “Throughout the process we have engaged our National Community Advisory Council (NCAC) for their guidance and feedback on our changes. These latest steps will further support our clients and empower them to create long-term financial wellness.”
Progress toward reducing overdraft fees
Since 2010, Bank of America has taken many steps to empower its consumer and small business clients to bank with greater confidence and reduce overdraft usage. The company leads the industry in helping clients avoid overdrafts and, in doing so, has significantly reduced the vast majority of fees related to overdraft. Key milestones along this journey have included:
- 2010 – Eliminated overdraft fees for consumer clients when using debit cards at the point of sale
- 2011 – Introduced courtesy low balance alerts
- 2014 – Launched the SafeBalance “no overdraft fee” account
- 2017 – Eliminated the extended overdrawn balance charge
- 2020 – Created Balance Assist, a low-cost solution to manage short-term liquidity needs
- 2021 – Launched Balance Connect for overdraft protection, letting clients link to up to five accounts to avoid overdrafts
- Feb 2022 – Will eliminate non-sufficient funds fees
- Feb 2022 – Will remove ability for clients to overdraw their accounts at the ATM
- May 2022 – Will reduce overdraft fees from $35 to $10
- May 2022 – Will eliminate Balance Connect for overdraft protection transfer fee (formerly $12)
“We remain committed to taking actions that will further bring down overdraft fees in the future and continue to empower clients to drive positive changes to behavior pertaining to overdraft,” added O’Neill.
In addition to the changes to overdraft related fees, Bank of America’s suite of Essential Solutions offers a powerful combination of transparent, low and no cost, easy-to-use offerings that help clients budget, save, spend and borrow carefully and confidently. The full array of solutions includes:
- SafeBalance® – With SafeBalance, there are no overdraft fees, and the monthly maintenance fee is waived for eligible students under the age of 25 as well as for clients enrolled in our Preferred Rewards program.
- Balance Assist – Balance Assist provides an affordable way for clients to manage their short-term liquidity needs, borrowing only the amount they need, up to $500 (in increments of $100) for a $5 flat fee regardless of the amount borrowed. Repayments are made in three equal monthly installments over a 90-day period. To learn more, review these additional product details and eligibility criteria. Borrowers must have been a Bank of America checking account client for at least one year.
- Balance Connect – Balance Connect allows our clients overdraft protection through the ability to link up to five accounts to their checking, while increasing simplicity and accessibility through digital sign-up and management.
- BankAmericard® Secured Card – This credit card can help clients establish, strengthen or rebuild credit, and they can apply for an account with a security deposit starting as low as $300. With responsible credit behavior, over time, this could help clients improve their credit score.
- Affordable Home Loans – In early 2019, Bank of America launched its now expanded $15 billion Community Homeownership Commitment, which has already helped 32,000 low- and moderate-income homebuyers achieve homeownership through low down payment loans and down payment and closing cost grants. By 2025, Bank of America anticipates helping more than 60,000 individuals and families to purchase homes through the program.
- Keep the Change® – This tool helps clients build savings by automatically depositing spare change from rounded up debit card transactions into a savings account. Over the last 15 years, this program has helped clients direct more than $15 billion in excess change to client savings.
- Better Money Habits® – A free financial education platform that provides a simple, accessible way to connect people to the tools, resources and education they need to take control of their finances.
Last year, Bank of America has been recognized with more than 280 industry awards for its innovation, financial technology, and delivering exceptional client services and solutions.
Certain statements contained in this news release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent the current expectations, plans or forecasts of Bank of America based on available information. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. These statements often use words like “expects,” “anticipates,” “believes,” “estimates,” “targets,” “intends,” “plans,” “predict,” “goal” and other similar expressions or future or conditional verbs such as “will,” “may,” “might,” “should,” “would” and “could.” Forward-looking statements speak only as of the date they are made, and Bank of America undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.
Forward-looking statements represent Bank of America’s current expectations, plans or forecasts of its future results, revenues, expenses, efficiency ratio, capital measures, and future business and economic conditions more generally, and other future matters. These statements are not guarantees of its future results or performance and involve certain known and unknown risks, uncertainties and assumptions that are difficult to predict and are often beyond Bank of America’s control. Actual outcomes and results may differ materially from those expressed in, or implied by, any forward-looking statements. You should not place undue reliance on any forward-looking statement and should consider all of the uncertainties and risks discussed under Item 1A. “Risk Factors” of Bank of America’s Annual Report on Form 10-K for the year ended December 31, 2020, and in any of Bank of America’s other subsequent Securities and Exchange Commission filings.
Bank of America
Bank of America is one of the world’s leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 66 million consumer and small business clients with approximately 4,200 retail financial centers, approximately 17,000 ATMs, and award-winning digital banking with approximately 41 million active users, including approximately 32 million mobile users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 3 million small business households through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and approximately 35 countries. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.
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Reporters May Contact:
Don Vecchiarello, Bank of America