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Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Congress repealed the Consumer Financial Protection Bureau’s overdraft rule in 2025 before it could take effect. The rule would have given banks and credit unions with more than $10 billion in assets three ways to handle certain overdraft fees; it was not a universal $5 cap. The repeal leaves no federal $5 ceiling in place under that rule.
What Congress did
The Senate passed a Congressional Review Act resolution to nullify the CFPB rule on March 27, 2025. The House approved it 217–211 on April 9, and President Donald Trump signed it. The rule had been scheduled to take effect on October 1, 2025, but was nullified before that date, so it never operated as an effective rule. Senate vote and remarks; House vote; signature and status; Associated Press context.
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What the repealed rule would have required
The CFPB’s Overdraft Lending: Very Large Financial Institutions rule covered banks and credit unions with more than $10 billion in assets. It would have allowed those institutions to choose one of three compliance paths:
- Charge a flat overdraft fee of $5.
- Charge a fee limited to the institution’s costs and losses from providing the overdraft.
- Continue charging a profit-generating fee, while providing disclosures required by lending law.
Because the $5 amount was one option among three, describing the measure as a blanket $5 cap gives the wrong impression. It also applied only to institutions above the asset threshold, not to every bank or credit union. CFPB rule details.
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What repeal means for bank customers
The repealed rule did not create savings for customers under an effective federal standard: it was nullified before its scheduled start. The CFPB had projected that its rule could save consumers up to $5 billion annually, or an average of $225 per household that pays overdraft fees. Those were projections published by the CFPB in 2024, not measured savings. CFPB savings estimate.
For comparison, the CFPB cited an estimated $12.6 billion in overdraft-fee revenue for 2019 in its January 2024 proposal announcement. That figure is historical, not a current revenue total. CFPB proposal announcement.
With this rule nullified, customers should look to their institution’s current account disclosures for its fee amount, when it charges the fee, and which overdraft services apply. The repeal itself does not establish a federal price limit.
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Regulation E still requires affirmative consent for certain overdraft services involving ATM withdrawals and one-time debit-card transactions. These opt-in requirements are separate from the CFPB rule that Congress nullified; they do not amount to a general federal cap on overdraft fees. CFPB explanation of existing Regulation E requirements.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why supporters and opponents disagreed
The CFPB presented its rule as a way to close what it considered a loophole in lending law and reduce consumer costs. Then-director Rohit Chopra said, “For far too long, the largest banks have exploited a legal loophole that has drained billions of dollars from Americans’ deposit accounts.” That was the CFPB’s argument for the rule, not a finding about effects after implementation. CFPB rule.
Supporters of repeal, including Senate Banking Committee Chairman Tim Scott and House Financial Services Committee Chairman French Hill, argued that the rule could reduce access to overdraft coverage, credit, and other banking services. Those were predictions advanced in support of repeal, not demonstrated consequences of this rule, which never took effect. Scott said during Senate floor remarks, “Overturning the Biden CFPB’s overdraft fee structure is good for consumers.” That statement was advocacy, not a measured outcome. Scott’s remarks; House committee statement.
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