Senate Republicans vote to eliminate cap on overdraft fees

Senate Republicans voted on March 27 to repeal a Consumer Financial Protection Bureau (CFPB) rule capping most bank overdraft fees at $5.

Overdraft fees are charged by banks and credit unions when customers spend more money than is available in their accounts. These fees can sometimes accrue interest, driving already cash-strapped individuals deeper into debt and poverty.

The rule, which was implemented in December 2024, was expected to save Americans billions of dollars per year. The CFPB estimated it would add up to $225 in annual savings per household.

Every Republican supported the repeal except for Missouri Sen. Josh Hawley.

This was the second time in a month that Republicans voted to roll back a CFPB regulation. On March 5, they voted to repeal a rule that required electronic payment apps like Zelle and Venmo to follow the same rules as large banks. The rule specifically aimed to strengthen fraud protections and prevent these apps from denying service to customers based on their political beliefs.

The fate of both rules is now up to the Republican-controlled House of Representatives.

The repeal effort had 12 co-sponsors, including North Carolina Sen. Thom Tillis, one of the few swing-state Republicans up for reelection in 2026.

“It is shameful that Republicans are effectively writing bonus checks to executives at the nation’s largest banks while ordinary people struggle with high prices and increased costs of living,” said Lauren Saunders, associate director of the National Consumer Law Center.

A Tillis spokesperson did not respond to a request for comment.