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Part II Conclusion of Moebs $ervices Overdraft Study
Created by m.moebs on 4/26/2022 10:28:33 AM

What follows is Moebs $ervices Study on The Evolution of Overdrafts done in two parts. This is Part II – the Overdraft Solution. Part I – the History of Overdrafts was provided in the previous issue.
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A Study by Moebs Services ©2022

Conclusion of Moebs $ervices Overdraft Study 

Today’s overdraft is far different than what it originally started about 100 years ago:

  • The 1968 Truth-In-Lending Act legitimized ODs and gave it a legal definition.
  • The Electronic Funds Transfer Act in 1979 is the origin of the modern Transaction-Account (formerly Checking Account) existing today, which is driven by debit cards, not checks and ruled by OD limit which allows authorization of OD transactions.
  • The 1991 Truth-In-Savings Act gave Congress’s endorsement of ODs, smoothed the edges of transaction disclosure and overdraft prices, and formalized the process of overdrawing. 
  • Congress passed Check 21 ACT in 2003 eliminating paper checks so processing float time ended quickly.

Each of these Congressional Acts formed the overdraft of today by the use of information ranging from definition to process. These acts provided a structure for financial institutions offering transaction accounts along with consumers and small business using the overdraft service. READ FULL ARTICLE

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