Dec. 1 (UPI) -- Capital One announced Wednesday that it would eliminate all overdraft fees and non-sufficient fund fees for its customers, essentially giving up $150 million in annual revenue.
The Virginia-based lender is the largest American bank to make the move. Its overdraft fees typically range from $25 to $35 in each instance.
Customers already enrolled in overdraft protection will be automatically converted to No-Fee Overdraft in early 2022. Those who don't want the new service will have their card declined without fees if they have insufficient funds.
"Capital One's complete elimination of overdraft and NSF fees is a landmark moment for American families," said Lauren Saunders, associate director of the National Consumer Law Center.
Banks have been under pressure for years from consumer advocates to eliminate overdraft fees because they affect the most vulnerable American populations. Those struggling to make ends meet may charge their cards with insufficient funds and be hit with multiple overdraft fees that they can't afford.
The industry made more than $14 billion in overdraft fees alone in 2019. Capital One took $131 million in the first nine months of 2021 in overdraft charges.
Capital One CEO Richard Fairbank said the service will be a valuable and convenient safety net for families.
The bank has 350 locations and 70,000 ATMs throughout the country. It was cofounded by Fairbank in the 1990s and has $425.4 billion in total assets.