I’m sorry but… who doesn’t know what an overdraft is? Is the first commenter 12?
overdraft fees are just another way to punish people for being poor or tight on money.
So, just in case someone doesn’t actually know, your typical overdraft fee works like this – if you have 25 dollars in your account, spend 26 dollars, the bank will process that amount but then charge you a fee of (typically) 35 dollars.
They’re also prone to doing really shady things like, if in the above situation you put in a deposit of 26 dollars to try and cover the amount, they will process the debit before the credit and you’ll still wind up in the hole.
So this isn’t a situation where people are spending 30 billion dollars they didn’t have. It’s a situation where people who literally don’t have the money to spare are being used as a source of profit.
I have worked in banking for years. The commentator above me is correct. The first commentator is an asshole.
My girlfriend, when she was banking with Bank of America specifically, would run into the following problem:
She would deposit, say, $50 in cash (ie it should be processed immediately) in her account when she had $50 already. That would bring her total up to $100.
She would then go do necessary shopping/bill paying and would spend, say, $90 on the things she needed to spend money on. AFTER her $50 cash deposit, which was supposed to process immediately.
She would then find out a few days later that what Bank of America had done was process the DEBITS first, and then the deposits, so that she overdrafted by $40 before they processed her $50 deposit, and because the processed the debit first, they still charged her the overdraft fee of $35 dollars.
So despite the fact that she should’ve had $10 to spare, she’d end up being $25 in debt after the overdraft fee, and sometimes they’d even charge her overdraft fees by the day, which meant that every day she was overdrawn, she owed another $30 or so, despite the fact that she had deposited enough money to cover her spending before she’d even spent a single dollar.
