TALLAHASSEE, Fla.— With credit union overdraft and NSF income under scrutiny from a group of senators, the League of Credit Unions & Affiliates has issued a statement saying that while “much is said about what credit unions charge, far too little is said about what credit unions prevent.”
As the CU Daily reported here, a group of Senate Democrats led by Sen. Elizabeth Warren (D-MA) sent letters to 21 credit unions seeking detailed information on their overdraft and non-sufficient funds (NSF) fee practices. The letters ask for disclosures on how much each institution charged per customer, how many accounts were closed in connection with fee activity, and whether the institutions plan to revise their overdraft policies going forward
‘Optional Safety Net’
“Overdraft programs are an optional safety-net service that millions of Americans actively choose because the alternative is often worse: bounced rent checks, utility shutoff notices, damaged credit, or having to turn to high-cost lenders,” the League said in a statement. “Credit unions are member-owned, not-for-profit institutions that design these programs to cushion short-term cash-flow gaps, not to trap people in debt. They pair overdraft services with small-dollar loan products, real-time alerts, financial counseling, fee caps, and grace periods precisely because their mission is to improve members’ financial well-being.
Removing a ‘Guardrail’
“In a moment when households are navigating unprecedented volatility in expenses and income, eliminating or mischaracterizing overdraft protection risks taking away one of the few guardrails that actually works for working families,” the League added.
The League further stated that credit unions’ people-first focus is exactly why overdraft protection, often referred to as Courtesy Pay, is designed to shield people from far more damaging consequences during emergencies or unexpected expenses.
“Courtesy Pay is not a revenue strategy; it is a member-requested safety net,” the League stated.
What Member Surveys Show
According to the League of Credit Unions, which represents CUs in Florida, Georgia, Alabama and Virginia, when credit unions have surveyed their members, the response is clear.
“Members want access to these financial tools and often rely on their credit union to have their back in difficult situations instead of using predatory third-party service providers.
Credit unions structure these programs intentionally to protect—not penalize—members,” the League stated. “They are voluntary, requiring members to opt in; transparent, with clear and plain-language disclosures; and used only when necessary, supported by financial education and counseling. Each program is thoughtfully tailored to the needs of the credit union’s membership and community.”
‘Protecting Members’ Stability’
“Credit unions are owned by our members. Every decision made centers on protecting members’ financial stability, not jeopardizing it,” Samantha A.M. Beeler, President of The League of Credit Unions & Affiliates, said in a statement. “A program such as Courtesy Pay is just one of the tools that helps people avoid greater financial harm during life’s unexpected moments.”
