WASHINGTON — The House Financial Services Committee is scheduled to mark up legislation tomorrow that could have a significant negative impact on credit unions' overdraft protection offerings.
The Consumer Overdraft Protection Fair Practices Act (H.R. 946), sponsored by Financial Institutions and Consumer Credit Subcommittee Chairwoman Carolyn Maloney (D-N.Y.), would treat overdrafts as a loan product and require the fees associated with the product be disclosed as an APR. The bill is one of five scheduled for mark up so it could be pushed back until Wednesday, CUNA Vice President of Legislative Affairs Ryan Donovan said.
Credit union lobbyists have said this would cause a problem for credit unions offering the product given the 18% usury cap for credit unions and are working with Maloney on a solution though an agreement has not yet been reached. CUNA had testified on the bill earlier this year.
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