AR Rep. French Hill, Republican lawmakers look to overturn cap on overdraft fees

Written By ApurbaDa February 21, 2025 Add Comment

WASHINGTON D.C. (KNWA/KFTA) — Arkansas Congressman French Hill and dozens of other Republican lawmakers are looking to reverse a rule introduced during the Biden administration that capped bank overdraft fees at $5 and closed an "outdated overdraft loophole."

Hill and Sen. Tim Scott (R-South Carolina) introduced a joint resolution on Feb. 13 to overturn the Consumer Financial Protection Bureau (CFPB) rule that was implemented in Dec. 2024 in the final days of former President Joe Biden's term.

The CFPB said at the time the rule change was to close a loophole that "exempted overdraft loans from lending laws."

The rule applied to banks and credit unions that had more than $10 billion in assets and gave institutions the ability to either cap overdraft fees at $5, cap the fee to an amount that covers any losses, or disclose the terms of an overdraft loan.

Then-CFPB Director Rohit Chopra said the decision was to crack down on "excessive junk fees" and require big banks to "come clean about the interest rate they're charging on overdraft loans."

Representative French Hill, a Republican from Arkansas, speaks during a House Financial Services Committee hearing in Washington, DC, US, on Wednesday, Nov. 20, 2024. The FDIC, in conjunction with the Federal Reserve and the Office of the Comptroller of the Currency, unveiled the original draft of a bank-capital proposal meant to force the country's largest lenders to hold significantly more capital to buffer against losses in July 2023, sparking furious opposition from the banking industry. Photographer: Al Drago/Bloomberg via Getty Images

Hill, who is the House Financial Service Committee Chairman, said the rule was "another form of government price controls that hurt consumers who deserve financial protections and greater choice" in a statement.

"Senate Banking Committee Chairman Tim Scott and I were clear when we told federal agencies – including the CFPB - to stop all midnight rulemaking, which former Director Chopra blatantly disregarded," Hill said.

The representative continued, saying the Congressional Review Act resolution will "help overturn this harmful rule and is a next step toward ensuring the CFPB halts all ongoing rules until it answers to Congress, just like any other non-independent federal agency."

The Democratic Party of Arkansas released a statement on X on Feb. 18 regarding the resolution saying Hill introduced this legislation that "serves the interests of big banks & financial institutions rather than hard-working Americans."

Hill and Scott said in a news release that the rollback has received support from "key stakeholders" including the Consumer Bankers Association, Independent Community Bankers of America, American Bankers Association, and America's Credit Unions.

More than two dozen Republican lawmakers joined Hill on the resolution including Arkansas Sen. John Boozman.

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