By Charlene Crowell –
While news headlines continue to focus on the chaos, confusion and legal challenges caused by the new administration’s recent changes, it could be easy to miss recent congressional actions that will cost consumers more than $5 billion annually in unnecessary and excessive bank overdraft fees.
On March 27, 2025, on a 52-48 Senate roll call vote, the Consumer Financial Protection Bureau (CFPB) overdraft rule was overturned. It would have lowered the typical cost of an overdraft fee at very large banks (with at least $10 billion in assets) from around $35 to $5. The measure now moves to the House of Representatives, where it is expected to soon pass, and then reach the president’s desk for final action.
South Carolina Senator Tim Scott, who chairs the chamber’s Committee on Banking, Housing and Urban Affairs, sponsored a Congressional Review Act resolution that required only a simple majority to pass. Should the House concur with a second majority vote, large lenders could charge fees much higher than the actual cost of an overdraft to the financial institution. Following the Senate vote, Scott claimed a consumer victory—despite a wealth of research that documents massive and negative financial impact to consumers paying excessive overdraft fees.
“This overdraft conversation is a critically important conversation if you are like me, a guy who grew up in poverty, a single parent household, who understands the difficulty, the challenge, of single moms making those ends meet,” said Scott. “I want every single hardworking American to have access to our financial system.”
But access on what terms?
It is curious that Sen. Scott’s comments do not acknowledge how overdraft fees already disproportionately impact Black and Latino consumers.
“Black and Latino consumers are already four to five…
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