Have you ever deposited a check online or received money through services and have to wait days to see that transaction show up in your bank account? A new bill in the U.S. Congress might end that frustration.
Maryland Senator Chris Van Hollen introduced the Payments Modernization Act on Thursday. The legislation would require banks to make money from check deposits and other financial transactions available immediately, including on Saturdays, Sundays and Holidays.
The bill has been referred to the Committee on Banking, Housing and Urban Affairs. An identical bill from Democrats has been introduced in the House.
“Americans deserve a banking system that works for them,” said Van Hollen in a statement. “But when deposited funds aren’t immediately available, it costs folks time and money — especially in exorbitant overdraft fees. With this legislation, we’re requiring banks to make the dollars Americans deposit in their accounts available to use immediately.”
According to the Consumer Financial Protection Bureau, “In 2019, banks and credit unions collected an estimated $15.5 billion from their customers through overdraft and non-sufficient funds fees.”
According to Bankrate.com, overdraft fees charged by banks typically range between $26 to $35.
By helping consumers avoid these fees, this legislation may bring a drastic change to personal finance.
In August, the Federal Reserve announced that it will roll out FedNow in the summer of 2023.
According to the Fed, the new system will offer real-time transactions between households, businesses, and financial institutions in the U.S. That immediacy will also aid customers in avoiding unneeded fees.
“This common-sense bill will help Americans better manage their money and will help pave the way for the Fed’s new faster payments system, FedNow,” said Van Hollen in a release.