Not many people would knowingly pay more than $35 for a cup of coffee. But far too many people are getting saddled — with no warning — with outsized bills for minor purchases, under a euphemistically labeled “overdraft protection program” that most major banks have adopted over the last 10 years.
Before that, most banks would simply have rejected debit transactions, without a fee, when the card holder’s account was empty. Now, they approve the purchase and tack on a hefty penalty for each transaction.[1]
It was just a week ago that the failing bank that I bank with sent me the letter letting me know what a favor they were doing me…Free overdraft protection. In the last paragraph was a note that I could voluntarily opt out by contacting their customer service department either by phone or in person. You can believe I stopped in very shortly afterwords.
I have been aware for years of the scam that “overdraft protection” has become. In the days of automatic payments and ATMs on every corner, why would I want a service that would allow someone to empty my account and keep going by mistake or intentionally. And to then be billed for the privilege. Get real folks. If you do not know what I am talking about, go read the editorial at the Times…They’ll explain it to you.
Oh, but the good news today is…The Federal government has found someone to take over this very same bank that was offering such a good deal. After weeks of looking for a “buyer”, the papers are saying this morning that…
Spanish banking giant Banco Bilbao Vizcaya Argentaria SA has won the bidding for the assets of Guaranty Bank, the troubled Texas lender, according to reports by Bloomberg News and The Wall Street Journal.[2]
So I guess those new checks that arrived yesterday will be outdated before I write the first one.
via [1] Editorial – Debit Card Trap – NYTimes.com.
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