Payments Views Challenge: What Are the Best Ways for Banks to Replace Lost Overdraft Fee Income?

by Carol Coye Benson on December 7, 2009

in Banking, Banking Industry, Carol Coye Benson, Financial Regulators

Post image for Payments Views Challenge: What Are the Best Ways for Banks to Replace Lost Overdraft Fee Income?

Bank income from debit card overdraft fees is variously estimated as $25 billion to $38 billion annually. The recently announced Federal Reserve Bank regulations requiring opt-in procedures will result in a gigantic hit to retail bank P&Ls, as we wrote about recently. JPMorgan Chase, for example, in a recent investor presentation, estimated the impact of their implementation of the new rules at $500MM after-tax.

So what’s a bank to do? Glenbrook is inviting its Payments News and Payments Views readers to submit their ideas.

Here are the requirements:

  1. Keep it short! a paragraph would be nice
  2. Explain what a bank would need to do and how it would capture revenue
  3. Let us know who you are – but also tell us if you want a published piece to be signed either anonymously (“debitgirl”) or not (jdimon@jpmorganchase.com) 🙂
  4. Get it to us by December 15th.

Payments Views will publish the top ideas. We’ve invited fellow bank-watchers Jim Breune of NetBanker and The Online Banking Report, and Steve Williams of Gonzo Banker and Cornerstone Advisors to help us rank the submissions. The criteria will include a) potential revenue impact b) feasibility (from “slam dunk” to “never gonna happen”) and c) innovation!

Have fun and let us know what your ideas are!

You can either complete the form below, or follow this link to complete the submission form.

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