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If you were charged more than one NSF (non-sufficient funds) bank fee for a transaction, you might wonder how many NSF fees a bank is allowed to charge.
While it’s not inherently illegal for banks to charge an NSF fee, consumers are crying foul when more than one NSF fee is charged on a single transaction.
If you have had the same electronic bill payment attempted and rejected by your bank multiple times, you could be incurring more than one NSF bank fee for that single transaction. At $30 or more per fee, your bank could be digging you into a deeper financial hole each time the transaction is attempted and there’s not enough money in your account, instigating the bank to reject the charge.
So how do NSF fees work? Essentially, an NSF fee is incurred each time a financial institution rejects a pending transaction and an electronic notification of the rejection is sent to the merchant who is expecting their money.
NSF bank fee lawsuits
Banks and credit unions have been defendants in lawsuits over allegations they charge unacceptable numbers of NSF fees for a single transaction.
In one NSF fee class action lawsuit, Digital Federal Credit Union was accused of having a “routine practice of charging two or three non-sufficient funds fees on a single transaction.”
Digital Federal Credit Union’s own documents allegedly indicate only one NSF fee would be charged no matter how many times the request for repayment was processed. If each request for repayment is considered a new, unique item, then the single NSF fee ends up equaling multiple fees for what is truly a single transaction.
In another lawsuit, USAA Federal Savings Bank was accused of breaching its contract to only charge one NSF fee for a single transaction. A woman alleged USAA charged her $29 three different times as a credit card payment was attempted multiple times.
Consumers allege banks are making extraordinary amounts of money by sometimes charging more for NSF fees than the initial amount of the intended transaction.
For example, one Bank of America customer said she was charged two NSF fees of $35 each before a transaction was covered, which also cost her an additional $35 overdraft fee. She lamented that one $20 payment towards a credit card cost her $115 total in NSF fees alone.
NSF fees are typically between $27 and $35, and are limited by a cap instituted by state law. Most states cap these fees at $20, $25, or $35, but some cap at $40 or even cap the fee at a percentage of the check amount.
On top of the risk of being unnecessarily penalized by getting hit with more than one NSF fee for the same transaction, these kinds of fees also hit the poorest American the hardest.
Banks were allowed to combine overdraft and NSF bank fee revenues into one category known as deposit service charges until 2015, according to the Consumer Financial Protection Bureau. At that time, the law changed, requiring overdraft fees and NSF fees to be tracked separately. The 2015 NSF fees totaled $11.16 billion in revenue for banks that had assets of more than $1 billion. That amount accounted for eight percent of the banks’ total net income.
The banks reported $3.87 trillion had been deposited in customer checking and savings accounts for the year ending Dec. 31, 2015.
How bank fees add up
In addition to an NSF fee, your bank also may charge you an overdraft fee. Together, the two fees could cost you $70 or more.
The overdraft fee is to cover the cost of the bank covering the money needed if your account does not have enough money in it to cover the amount of the bounced check. This overdraft protection is often around $35 per transaction, though it can skew a little lower or a little higher, depending on your financial institution or where you live.
Even if you have another savings account, line of credit, or credit card linked to your checking account in the event an overdraft occurs, the bank still may charge you a fee for the service of moving the money around from one place to another to cover the transaction amount.
The Center for Responsible Lending released a report on consumer bank fees assessed in 2019. In that report, the Center called the average overdraft fee of $35 as an “unreasonably high” figure because most customers who go into overdraft status usually do so because of a relatively small purchase amount of around $20. It’s hard for most consumers to see the justification of charging a customer $35 for the privilege of spending $20.
Research authors noted that 10 of the biggest banks in the United States collected more than $11 billion in consumer fees from their customers during 2019 alone.
In addition, the report indicates that nine percent of account holders pay approximately 84 percent of the overdraft-related bank fees, and the majority of these account holders only have an average of $350 in their account. There are a number of ways to avoid paying NSF fees, but the best way is of course to avoid incurring them in the first place.
Filing an NSF fee lawsuit
A growing number of people are filing lawsuits over NSF fees against their financial institutions, alleging the fees were unfair, excessive, or deceptive. If you have been hit with unfair or deceptive overdraft or NSF fees by your bank or credit union, you may be able to file a lawsuit and pursue compensation.
In many cases, a problem with unfair NSF fees can affect many more than one customer at a time due to issues with contractual promises the bank or credit union made to its customers as a whole.
Filing a lawsuit can be a daunting prospect, so Top Class Actions has laid the groundwork for you by connecting you with an experienced attorney. Consulting an attorney can help you determine if you have a claim, navigate the complexities of litigation, and maximize your potential compensation.
Join a Free NSF Fee Class Action Lawsuit Investigation
You may qualify to join this NSF fee class action lawsuit investigation if you were unfairly charged NSF fees by one of these banks:
- BancFirst
- Bell Bank
- Busey Bank
- Center Bank
- CenterState Bank
- Flagstar Bank
- Glacier Bank Wings Federal Credit Union
- Midwest One
- NBT Bank
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76 thoughts onHow many NSF fees can a bank charge on a single transaction?
Bank of America did this to me and I had money in my account!? They stole about 700 from me during the start of the pandemic.
I have to tell you about U S Bank and one mgr’s “creative” greed. I opened a checking acct so my disability could be direct deposited. At that time, an employee contest was active. Whom ever opened the MOST new accounts -a trip to Hawaii for 2 was top prize. The bank mailed out flyers, open an acct, get 200 bucks. A code on the flyer was the key to the 200.I opened the acct, then 6-8 weeks later, 200 is deposited into the acct. 10 weeks later, no 200. I go to the bank and the mgr explained that”The code got lost, we have to start over”. “She said we will open a NEW ACCT. resubmit with a new code, 4-6 weeks later it will deposit.” I was so angry, left, called customer service # on the back of my card. I explained what was going on and was put on hold. They got a supervisor to listen in. Apparently the mgr had been doing this for 3 months! To many people, it never occurred to them they were being used. Both new acts had to remain open, making sure the direct deposit won’t get sent back. She got credit for 2 accts, when the deposit started to go to 2nd acct, 1st was closed. I refused to “go along with”. I filed a grevence, a few days later my acct was overdrawn over 400!! Opening the acct I was very vocal about not wanting to be able to overdraw my acct, I signed, a specific form opting out of spending money that wasn’t there. To change this REQUIRES IN PERSON, IN BANK. I NEVER done that, nor did they produce a signed form. For 8 weeks the mgr refused to replace mymoney, fees, telling me to “Take responsibility for my actions”. I called the # again on the card, explained that each branch’s mgr must do that. Wow, I didn’t know what to do next, I have been disabled 35+ yrs, a single dad, raising her from 6 yrs old, I was panicked. The mgr got caught in her scheme, was being terminated, blaming ME.Well, the next day I went to the bank, told mgr “Your bosses told me to come here, and in front of me they want you to call them. This ends today, no more 3 different stories. She refused 3 times to do so. I told her they were MY next call, she snatches her moniter, spins it around, looks at me and says”Spell last name, I’M NOT reversing ALL of it, but what she did do took me out of the red into a positive balance. Boy, if looks could kill… Ever since, it’s one problem after another. She reversed half of what was gone, I was freaked out, It was months before I settled down. (Severe PTSD). How can I get back the rest? It’s been 5 yrs I think. I probably just sank my butt, but I am tired of feeling like this bank literally holds my life, happiness, freedom as if it’s a hostage or something. I have never been lied to, and treated so bad by supposedly “professional people” ever in my life. When I came in to open that acct-the mgr took one look at me, (unshaved, breath smelled like booze), and figured I was just another drunk, and doesn’t /couldn’t pay attention to the balance, that I would be no problem working me. WRONG, she doesn’the know how her “bosses” found out. She had been cutting in a few tellers so create smokescreens, and believable excuses on how codes were “lost”.. Moral of the story? NEVER underestimate what a screwed over customer is capable of! Oh, at the bank that day it was so overdrawn, a friday-the mgr’s pet teller waves me to his window, asked me if 60 bucks will get thru the weekend. He’d keep the withdrawal slip til Monday, when they’d be replacing the money. He said this could get him fired; but that way no more fees. He ran the slip thru my acct before I was even out of the lobby, and yep-another 30 something overdrawn fee. Creative, is the word I use to be “politically correct ” in that “professional ” world of yours. Yes, this is 100% true.
What about Bank of America?? This happens all the time and I’ve gotten stuck at being negative Time and time again bc of the duplicate fees!! I’ve paid out $1000s in fees. And what about the ATM fees that you get hit with that are duplicated? The one you know about bc the atm tells you but your bank charges you another one bc something about they receive a charge and you reimburse them for that charge. It’s ridiculous!!!
Add me
Sunbelt Federal credit Union charged my husband NSF of $30. 18 times from the same company for the same amount All IN ONE DAY BACK TO BACK
Amount
My credit union is implementing a multiple charge for NSF when a company makes multiple attempts. The companies I deal with usually make a minimum of 3 attempts. That adds up to $105 in fees, plus the charges that aren’t covered.
My credit union, clarion federal credit union does the same. $105 per transaction and that can happen in one day! Granted it’s my fault for overdrafting my account but c’mon one charge is understandable, but 2 more fees and you are still on the hook for the entirety of the transaction. They should at least use the
$70 towards the transaction cost. It’s a slippery slope once it starts and it’s hella hard to pull out if it. I paid over $18,000 in service charges last year alone. I still owe about $150/ and they will be getting that in installments because I no longer use them. I would love to see a law passed to protect the users of these institutions of greed!
Me
Can Commerce Bank be added to the list? I have been charged thousands of dollars in overdraft fees in the past couple years. They don’t seem to have a daily limit on the number they can charge, and they will charge for every attempt. It’s predatory and greedy. If someone doesn’t have the money to pay their bills, what makes banks think that those people would have money to pay all these overdraft fees AND their bills?!?!
Add me wells Fargo charge me fees of $175 and $204 in less than a 4 week apart and when when made my transactions the money was taken right there when I used my card so why I’m I paying NSF they said because some merchant don’t charge the same day and I said that as nothing to do with me when it is taken from my account the day I swipe my card
Capital City Bank has charged me NSF literally for nothing. I had a $3 charge after that charge my balance was +$259.11 tge next 2 deductions are for $35 NSF fees balance after $186.11. That was on a Wednesday. Then a week later I moved $840 to my checking to cover some payments which would have overdrawn my acct by -$440. I checked my balance to make sure the transfer was there it was my balance was $399.10. I actually took a scree screen shit if my mobile banking acct. I didn’t bother to look at it till Friday. They put all the charges they 1st then the deposit. I had 6 $35 NSF charges. I called them and they said “this is not what we see”. I told them “I actually have pictures now. I knew you all were stealing.” This happened last month. I have not switched banks yet because I want my money back!!
Netspend/Bancorp completely ripped me off with hundreds if not thousands of dollars and Idaho Central Credit Union got me for thousands as well. Please let me know if either of these banks are included in a lawsuit.
Yes Bank of America have done me like that on several occasions