Banks Provide Financial Safety and Convenience to a Broad Range of Consumers. Service Charges Make It Possible.

BPI submits a statement for the record to the Senate Banking Committee on fees

Washington, D.C. — The Bank Policy Institute submitted a statement for the record today to the U.S. Senate Banking Committee for a hearing to examine fees in financial services. The statement examines the many ways that banks support businesses and consumers by making financial services safe and accessible.

What we’re saying:

Paige Pidano Paridon, BPI senior vice president and senior associate general counsel, stated:

“We urge lawmakers to take action and hold the CFPB accountable for its misguided campaign against bank fees, which contrary to the CFPB’s misrepresentations, these fees are not ‘junk fees.’ In the same way that governments collect taxes to pay for roads and bridges, banks pay for essential systems and staff through fair and transparent service charges. Criticizing the banking industry for charging fees ignores the substantial benefits consumers enjoy — at low or no cost — such as direct deposit, FDIC insurance, 24×7 access to funds, cashback and fraud and travel protections — to name just a few.”

Here’s the reality:

  • Offering services and products comes at a cost. BPI members operate over 36,000 branches nationally, employ nearly 2 million Americans and facilitate trillions in loans to households and businesses. Service charges are important to help fund these activities.
  • Banks listen to their customers. Banks are constantly identifying ways to better serve their customers and expand access to financial services, such as by lowering or eliminating charges like overdraft fees or offering low- or no-cost deposit accounts through programs like Bank On.
  • Banks are legally required to disclose fees upfront. Unlike other industries, banks are heavily regulated and are required to disclose all fees when an account is opened or when service charges change. These rules include:
    • TILA/Reg Z (credit card fees)
    • Regulations DD and E (deposit account and electronic fund transfer fees)
    • TILA/RESPA (mortgage origination and settlement service fees)
    • Truth in Savings Act
  • Fees help to incentivize responsible financial behavior. In some cases, fees help to encourage customers to pay on time and adopt other healthy financial habits. Some fees, such as credit card late fees, allow banks to offer credit to a broader range of consumers across the credit spectrum.

To access a copy of the written statement, please click here. Learn more and get the Facts on Fees through the following resources:

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About Bank Policy Institute.

The Bank Policy Institute is a nonpartisan public policy, research and advocacy group that represents universal banks, regional banks and the major foreign banks doing business in the United States. The Institute produces academic research and analysis on regulatory and monetary policy topics, analyzes and comments on proposed regulations, and represents the financial services industry with respect to cybersecurity, fraud and other information security issues.

Media Contact

Austin Anton
Bank Policy Institute
austin.anton@bpi.com

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