Study Shows Overdraft Programs Don't Meet Most Consumer's Needs

Study Shows Overdraft Programs Don't Meet Most Consumer's Needs

Banks offer overdraft protection programs ostensibly to protect consumers. In theory, by opting into these protections, account holders shield themselves from having payments not go through.

The overdraft protections allow for consumers to over-draw their accounts to varying degrees depending on the bank and the program. When this happens, the bank covers the charge, but tacks on a fee (generally $35 per overdraft). That's a stiff price to pay when a math error or a check not clearing in time causes one or more overdrafts.

Consumers have to opt into these programs, but a new survey conducted by Pew Charitable Trusts shows that many people remain confused.

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Source: Fool.com