WASHINGTON, D.C. (April 9, 2025) |
Today, the Defense Credit Union Council (DCUC) celebrates the House passage of 217-211 of Senator Tim Scott’s (R-SC) joint resolution (S.J. Res. 18) to repeal the CFPB’s overdraft rule, “Overdraft Lending: Very Large Financial Institutions”, restoring balance and oversight to the regulatory process.
The resolution, which quickly gained bipartisan support, passed the Senate last month by a vote of 52-48 before advancing to the House for final approval.
DCUC has consistently opposed the CFPB overdraft rule since it was first proposed in December 2024, which applies to financial institutions with more than $10 billion in assets. The rule mandates that these institutions either cap most overdraft fees at $5 or classify overdraft programs as credit under the Truth in Lending Act (TILA).
Beyond imposing unnecessary restrictions, DCUC has shared how the rule creates significant compliance challenges for credit unions. See DCUC’s letters on this issue here.
Reclassifying overdraft protection as a credit product under TILA would require costly system overhauls, additional disclosures, and extensive compliance measures, despite members having already opted in with an understanding of the terms. This regulatory strain creates uncertainty for many credit unions and jeopardizes their ability to effectively serve their communities.
Last month, DCUC commended Senator Scott’s leadership in introducing this resolution and bringing it before the Senate. Today, DCUC extends its appreciation for the House’s swift action in supporting this critical measure.
"We are grateful for Senator Scott’s leadership in protecting consumers, restoring regulatory balance, and preserving access to fair, flexible financial services," said Anthony Hernandez, DCUC President/CEO. "DCUC remains steadfast in advocating for the financial well-being of service members, veterans, and their families."
For more information, please contact Jason Stverak at jstverak@dcuc.org and visit dcuc.org/advocacy.