Uptick in Overdraft-Related Revenue Reported by Large U.S. Banks
During the first three quarters of 2025, several of the largest U.S. banks have reported an increase in overdraft-related revenue. Interestingly, this surge in revenue coincides with the defanging of the Consumer Financial Protection Bureau (CFPB) under the Trump administration. Though, some banks attribute the revenue increase to more consumers utilizing overdraft services rather than changes in policies.
The Current State of Overdraft Revenue
Noteworthy banks such as JPMorgan Chase, TD Bank, and Citizens Financial Group have reported an increase in overdraft-related revenue. This comes years after many large and regional banks reduced or eliminated the fees they charged when clients overdraw their accounts, resulting in a reduction in overdraft income. Despite the increase, the total amount of overdraft-related income that banks are collecting is significantly below the amount they were collecting before the overdraft reforms of 2022.
Inflation and Changing Consumer Behavior
Banks have pointed to changing consumer behavior as a primary factor contributing to the uptick in overdraft fee revenue. With inflation and other economic challenges, more consumers are resorting to overdraft services. Banks also contend that the increase in overdraft fee revenue is a result of opening more customer accounts.
JPMorgan and Citizens Financial Overdraft Revenue
JPMorgan, the nation’s largest bank by assets, reported a 7.66% year-over-year increase in overdraft fee income for the first three quarters of 2025. A steeper increase was reported by Citizens Bank, the banking division of Citizens Financial, which reported a 16.9% increase compared to the same period in 2024. Both banks stated they have not altered their overdraft policies in the past year.
Regulatory Changes and Consumer Advocacy Concerns
Overdraft charges have been a contentious topic for years. The Biden administration had attempted to regulate these “junk fees,” arguing that banks were charging such fees in an unfair or deceptive manner. However, this effort was overturned by the Republican-led Congress, raising concerns among consumer advocates about the potential for banks to alter their overdraft policies.
Overdraft Revenue for Other Banks
While JPMorgan and Citizens witnessed an increase in overdraft-related revenue, other banks reported decreases. For instance, Capital One Financial’s overdraft-fee revenue declined significantly following its decision to eliminate these fees. Truist Financial and Wells Fargo also reported a year-over-year decrease.
Conclusion
Overdraft fees have long been a controversial issue, with critics arguing they disproportionately affect low-income customers. While some banks have taken steps to reduce or eliminate these fees, the recent increase in overdraft-related revenue at several large banks raises questions about the future direction of these policies, particularly given the current deregulatory environment. As banks continue to navigate this issue, consumer advocates are likely to continue to push for greater transparency and fairness in the banking sector.
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