Do big banks have better overdraft policies than your credit union?

If there’s one thing consumers want from their checking account providers, it’s greater transparency. If your disclosures look long and complicated, consumers are going to assume you’ve got something to hide. More and more financial institutions are moving to simpler policies that are more consumer-friendly and easier to understand.

Nine in 10 Americans have checking accounts. Unfortunately, the formal disclosure documents outlining these accounts’ fees, terms, and conditions are often long, unintelligible, and opaque. Overdraft and transaction processing practices often result in surprise fees. And dispute resolution terms leave little room for consumers to choose how they want to proceed in the event of a problem.

According to study by Pew Charitable Trusts, banks’ disclosure policies have improved, especially those related to overdrafts. With some regularity now, Pew has been examining how consumers are affected by the terms and conditions of checking accounts — with a particular focus on overdrafts — by reading, reviewing and analyzing account agreements to determine bank policies and practices. Pew’s latest report evaluates the practices of 44 of the 50 largest retail banks in the U.S. These institutions hold approximately 65% of all domestic deposits.

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