Wells Fargo Launches Two New Bank Accounts with Limited Overdraft Fees
Wells Fargo plans to launch two new bank accounts early next year. Today, the bank announced the development of a no-overdraft and limited-overdraft account option to help customers combat fees.
On average, Americans pay $34 billion in overdraft fees per year. Young adults and low-income households are particularly vulnerable to these fees because they are more likely to temporarily overdraft their accounts. A study from 2015 showed that many college students spend over $710 per year on overdraft fees.
One of the new Wells Fargo accounts will be a checkless account with no overdraft option. Users can only spend the money that is in the account, resulting in no overdraft fees or insufficient fund fees. The account will come with a monthly fee of $5, but it will include access to online banking, mobile alerts (including low balance alerts), Zelle, in-person banking, and ATMs. Accountholders will not be able to write checks, but they can access their funds with a debit card.
The second new account will support checks and will only charge one overdraft fee per month, when applicable. This account comes with a $10 monthly fee and offers access to the services mentioned above.
Over the last year, Wells Fargo has made efforts to rebuild its tarnished reputation. The bank faced a slew of scandals in 2017 and 2018, including a fake account scandal that resulted in a $145 million settlement and a mortgage loan controversy that cost $2 billion. Since then, Wells Fargo has closed 52 branches, restructured its risk management department and tested digital currency to streamline international transfers. The bank has also transitioned its debit and credit cards to contactless cards, so customers can tap-to-pay with select merchants.