US banks collected $1.6 billion in overdraft fees during the third quarter of 2026, marking a 9.4% increase from the previous quarter and the highest quarterly total in four years.
The figures, calculated by Reuters and confirmed by financial data provider KBRA Financial Intelligence, raise concerns about the financial health of American households. Economists warn that rising overdraft activity could signal growing difficulties among consumers who struggle to maintain sufficient account balances.
The increase also comes amid political debate over banking regulation and the future of the Consumer Financial Protection Bureau (CFPB). Democrats recently regained control of both chambers of Congress in the midterm elections and have pledged to increase scrutiny of the agency’s oversight.
US Bank Overdraft Fees Rise 23% Since Trump’s Return
Overdraft fees have increased steadily since the beginning of President Donald Trump’s second term.
Bank revenue from these charges rose 23% in the three months ended September compared with the first full quarter of Trump’s presidency. Nevertheless, current collections remain below historical peaks.
The fees had reached a record low in the first quarter of 2025, when Trump took office. During the previous administration, former President Joe Biden emphasized consumer protection and supported measures to reduce the cost of overdrafts.
In December 2024, the CFPB introduced a rule that would have limited overdraft fees to $5 per transaction. However, Congress passed a resolution to repeal the measure, which Trump signed in May 2025. The rule never took effect.
Since then, the Trump administration has also sought to reduce the CFPB’s workforce and narrow its enforcement priorities. These changes have raised concerns among consumer advocates about the agency’s ability to oversee financial institutions.
“It is impossible to separate what banks are charging in overdraft from what is going on at the CFPB,” said Adam Rust, director of financial services at the Consumer Federation of America.
The CFPB did not respond to request for comment.
JPMorgan and Wells Fargo Lead Overdraft Fee Collections
JPMorgan Chase and Wells Fargo collected a combined $590 million in overdraft fees during the third quarter, according to regulatory filings.
Together, the two banks accounted for roughly as much revenue as the other 20 largest US lenders combined.
JPMorgan’s overdraft fee revenue increased 32% compared with the first quarter of 2025. Wells Fargo recorded a 17% increase over the same period.
Other major banks reported different trends. Bank of America’s overdraft revenue climbed 49% since early 2025, reaching $55 million. That amount remains considerably lower than the collections reported by JPMorgan and Wells Fargo.
Bank of America reduced its overdraft fee from $35 to $10 in 2022. The decision followed a CFPB report criticizing how major lenders charged customers who spent more than their available account balances.
Citi took a different approach and eliminated overdraft fees in 2022.
Despite the recent increases, JPMorgan and Wells Fargo say they continue to limit the charges through grace periods and other customer protections.
A JPMorgan spokesperson said 75% of transactions that leave customers with negative balances do not generate an overdraft fee. A Wells Fargo spokesperson reported the same proportion for transactions that trigger overdrafts.
First Citizens Records Sharpest Increase Among Major Regional Banks
Overdraft fee revenue has also climbed sharply at several large regional lenders.
First Citizens Bank, based in Raleigh, North Carolina, recorded the largest increase among the 50 biggest US lenders. Its overdraft revenue rose 200% compared with the first quarter of 2025.
The bank did not respond to a Reuters request for comment.
J.V. Proesel, president of Moebs Services, which advises banks on account fees, said some institutions are seeking additional revenue through overdraft charges. However, he noted that many lenders remain cautious about introducing fees that regulators or lawmakers could later challenge.
Proesel also warned that the recent increase may not last indefinitely. He expects regulators or lawmakers to revisit overdraft policies, potentially forcing banks to reverse some of their pricing decisions.
Rising Overdraft Fees Could Signal Financial Stress Among Consumers
Economists see the increase in overdraft fees as a possible warning sign of weakening household finances.
Mark Zandi, chief economist at Moody’s Analytics, questioned whether rising overdraft activity could precede broader credit problems.
Real wages, adjusted for inflation, have declined since April, according to the report. Meanwhile, delinquency rates on auto loans and credit cards have remained relatively stable over approximately the past year.
The combination of declining purchasing power and increasing overdraft activity could indicate that some households are struggling to cover everyday expenses.
Overdraft charges typically occur when customers spend more money than they have available in their checking accounts. For consumers with limited financial reserves, these fees can add further pressure to already strained budgets.
Democrats Prepare to Increase Scrutiny of Banking Regulation
The increase in overdraft fees could also become a political issue as Democrats prepare to take control of both chambers of Congress.
Consumer credit problems, bank overdrafts, and the Trump administration’s efforts to reduce the CFPB’s workforce featured prominently in Democratic campaigns during the recent midterm elections.
Senator Elizabeth Warren, a longtime critic of Wall Street and one of the architects behind the CFPB, is expected to chair the Senate Banking Committee.
Democrats have pledged to examine the agency’s oversight and enforcement activities more closely. Their efforts could bring renewed attention to bank fees, consumer lending practices, and financial protections.
Trump initially pledged to abolish the CFPB but later pursued measures to significantly reduce its operations. His efforts to cut the agency’s workforce have also faced legal challenges.
The future of overdraft regulation will therefore depend partly on the balance of power between Congress, the administration, and federal regulators.
For now, the latest figures highlight a significant increase in bank fee revenue. They also raise questions about whether rising overdraft charges reflect a broader deterioration in American household finances.
