Money People Don't Have

So I was listening to Marketplace the other day. They reported that the FDIC estimates that banks pull in around $17 billion dollars worth of overdraft charges annually. (And this might be set to go up as banks look to replace falling revenues from credit cards, now that new rules have taken effect.) In the same story, we also learn that the average overdraft fee is $35. To get to $17 billion at $35 a pop, you need more than four hundred eighty-five million transactions. That's in the area of one and a half times the entire population of the United States.

Given that not everyone in the United States has a bank account, and not everyone in the United States with a bank account overdraws their checking account at least once a year, there are some people who are bleeding themselves dry with multiple charges annually. While Nessa Feddis at the American Bankers Association claims that people are willing to pay for having transactions go through, I suspect that Jean Ann Fox at the Consumer Federation of America is also on the right track when she effectively contends that the banks have made covering overdrafts into a product - one that's profitable enough that there's no reason for them to discourage even accidental purchases.