Congress is considering bills to ensure fair overdraft coverage, yet there are thousands of community banks and credit unions already offering fair, consumer-oriented overdraft protection programs. Rep. Barney Frank (D-Mass.) said, "Don't do favors for people without asking them." These institutions do ask. They fully disclose to their customers and members the overdraft protection services they provide when accounts are opened. They provide simple explanations of coverage and fees, notifications of program use and they ensure consumers are aware of their right to opt-out of this service at any time. Community banks and credit unions that offer this type of overdraft protection do so because their customers and members value the service. Like the consumer groups, many members of Congress have focused on the approach to overdraft protection taken by financial conglomerates like Bank of America, Citibank and others. While examples of their questionable practices are dramatic and make for good press, the reality is that there are thousands of community banks and credit unions being unjustly targeted without knowledge or understanding of the key differences in how they operate their overdraft protection programs. Denying their customers and members access to a service they choose to use isn't protection, it's presumption that people who use a fully disclosed overdraft program aren't intelligent enough to make their own financial decisions. To really ensure fair overdraft coverage, lawmakers should use the overdraft protection programs offered by these community banks and credit unions as a model. They should also stop treating the practices of financial conglomerates as representative of all banks and credit unions. Congress should acknowledge that consumers have the responsibility for managing their finances and for leaving financial institutions that don't treat them well. We need to allow low- and moderate-income Americans continued access to fair, fee-based overdraft programs. Consumers like having the safety net of fully disclosed, fee-based overdraft protection programs. They've said it and they've demonstrated it by patronizing their community banks and credit unions. Yes, one should ask before doing favors. It's also important to listen to the answer.

Joe Gillen is CEO of Pinnacle Financial Strategies. He can be reached at 713-868-3333 or [email protected]