Rules Regarding Credit Card Account Balance Overdraws

With a credit card account balance, overdrafts can happen if purchases overlap, or ATM usages and fees do not post immediately. For years, credit card issuers have used this as one method of increasing the money they were able to charge their customers, sometimes in legitimate ways, and other times quite unfairly. Several financial regulatory boards, including the Federal Reserve Board and the Federal Trade Commission, have set out a new set of rules, designed to protect customers from unfair credit card practices, including account balance overdraws.

Overdraft Disclosure

Overdraft disclosure on your credit card account outstanding balance means that your credit card issuer must include the details of any overdrafts and charges for the previous month. For consumers, it gives them details about how overdrafts are handled by the credit card company, and let's them see exactly what fees are being placed against the account as a result of the overdraft.

Overdraft Account Balances

If you check your credit card balance with an automated service, including ATMs, telephone checks, and online systems, the credit card company is not allowed to provide certain overdraft and funds information. This includes the amount of overdraft protection, and funds that may be transferred from another account to cover overdrafts, among other stipulations.

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