On Aug. 27, CAL LEG passed bill, fees on instant declined transaction.
CAL LEG passed Assembly bill AB 2017 to ban instantaneous nonsufficient funds fees.
Amends Financial Code, Division 1 to add CAL FIN 5.5-530 (nonsufficient funds fees).
Follows CFPB proposal to stop fees for transactions declined in real time, #198775.
Bill aims to establish similar policy, which would apply to banks, CUs with State charter
Bill Provisions
Bank/CU subject to CAL DFPI exam authority may not charge consumer nonsufficient funds fee when consumer's attempt to initiate transaction is denied instantaneously.
Or near instantaneously by the bank or credit union due to nonsufficient funds.
Nonsufficient funds fees are fees resulting from initiation of a transaction that exceeds account balance if customer’s bank/CU declines to make payment (CAL FIN 1-5-2-521)
Legislative History
On Jan. 31, 2024, bill introduced in Assembly; on May 16, 2024, bill passed Assembly.
On May 16, 2024, bill introduced in Senate; on Aug. 21, 2024, bill passed in Senate.
On Aug. 27, 2024, bill was enrolled by both chambers and presented to the governor.
Effectiveness
If approved, bill will go into effect Jan. 1 in the year following enactment.
Sep. 2024 CAL LEG Governor Approval
On Sep. 24, 2024, CAL LEG reported bill AB 2017 approved by governor, Chapter 509.
Regulators
CAL LEG
Entity Types
Bank; CU
Reference
Ch. 509, 9/24/2024; Bill AB2017, 8/27/2024; CAL FIN 5.5-530; Citation: CAL FIN 1-5-2-521;
