The credit union industry, which has expressed its detest of the CFPB’s final overdraft rule for months, may have found a legitimate, and potentially quick, solution to relieving that anger.
As lawsuits filed by multiple agencies fighting the CFPB have piled up to stop the rule from going into effect on Oct. 1, Republican lawmakers in the House and Senate have introduced resolutions to effectively repeal the final rule.
The CFPB’s final overdraft rule essentially reforms overdraft fee options for credit unions and banks with assets of more than $10 billion. Those financial institutions, according to the final rule, can choose to charge a $5 overdraft fee, charge a fee that covers no more than the cost or losses of an overdraft transaction, or charge a fee while disclosing the interest rate of the loan.
Senate Banking Committee Chair Tim Scott (R-S.C.) and House Financial Services Committee Chair French Hill (R-Ark.) both filed Congressional Review Act resolutions to invalidate the CFPB overdraft rule. With a Republican majority in the House and Senate, as well as the Republican President Donald Trump, the likelihood of this legislative maneuver has a good chance of succeeding.
Officials with the Defense Credit Union Council (DCUC) were quick to praise the efforts on Thursday.
“DCUC applauds House Financial Services Chair French Hill and Senate Banking Chair Tim Scott for addressing this flawed rule,” DCUC President/CEO Anthony Hernandez said.
“Consumers, particularly military and veterans, rely on robust overdraft protection programs not only as they organize, train and equip to fight our nation’s wars, but especially when they are in harm’s way and cannot flex to keep bills on track back home,” Hernandez added. “Without overdraft, late fees from utility companies, rental agreements and other day-to-day expenses would become overwhelming.”
On Friday, America’s Credit Unions along with the Consumer Bankers Association, American Bankers Association, Independent Community Bankers of America, and the Bank Policy Institute released a joint statement and letter also praising the moves by Sen. Scott and Rep. Hill, stating, “We appreciate your efforts to invalidate this deeply flawed, harmful rule.”
The letter warned, “If not invalidated, former Director Chopra’s final rule will effectively bring an end to overdraft services for consumers who have few, if any, other options for meeting short-term liquidity needs, all to advance the prior administration’s political campaign against ‘junk fees.'”
“Before the CFPB released its overdraft proposal, many financial institutions had proactively made changes to their overdraft programs to reflect competitive developments within the industry. These innovations include sending low balance alerts, imposing a de minimis threshold triggering an overdraft fee, capping total fees that the bank may charge per day, and providing overdraft 'grace periods' during which a customer can make a deposit and avoid a fee.”
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
