What's with this new overdraft policy? [View All]

[Orrex]

I don't know if the law went into effect here in PA recently, or if I'm just noticing the signs more, but I've been seeing a lot of this language lately:

If your check is returned to (business' name) unpaid, your check will be electronically debited for the amount of the check plus a fee as permitted by state law.

No mention of how big that that fee might be, you'll notice.

Is this new? Is it national? If not, does your state have this law?

It's pretty fucked up, and, like everything else, it particularly screws people with lower incomes, because in essence it says:

If you have too little money, we're going to force you to pay even more.

Additionally, you can be pretty sure that your bank will also hit you for overdraft, as well as any fees for dipping your checking account balance below the minimum balance. So the $7.32 you planned to spend on a few groceries suddenly hits you with a $20.00 return fee, plus $30.00 overdraft fee, plus $10.00 balance threshold fee.

I know, I know. The person shouldn't be writing checks against money they don't have, and in any case this is basically just a modernization of standard "returned check" fees that have been in place for years.

But something seems weirdly intrusive about this. Most of the people I see writing checks in stores are elderly, and my sense is that many of them prefer to write checks because they've done so for 60 years, and they're not comfortable personally engaging in electronic commerce.

It also seems to me that if stores can debit your account via check in this way, then they can do an instant--and free--balance verification upon receipt of the check, as well as instant clearing of the check (if funds are available) as many banks have started to do.


Regardless, this is yet another case in which our society punishes people who have the selfish gall to be poor.