CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION Senate Bill No. 1075Introduced by Senators Bradford and LimnFebruary 12, 2024 An act to add Section 14053 to the Financial Code, relating to credit unions. LEGISLATIVE COUNSEL'S DIGESTSB 1075, as introduced, Bradford. Credit unions: overdraft and nonsufficient funds fees.The California Credit Union Law generally provides for the organization and regulation of credit unions by the Commissioner of Financial Protection and Innovation. Existing law requires a credit union subject to the examination authority of the commissioner to report annually to the commissioner on the amount of revenue earned from overdraft fees and nonsufficient funds fees, as defined and specified.This bill would require a state-chartered credit union to provide a customer at least 5 business days before requiring payment of an overdraft fee or nonsufficient funds fee to give the customer an opportunity to repay the amount that triggered the fee. The bill would prohibit a state-chartered credit union from charging more than 3 of those fees per month. The bill would require a state-chartered credit union to disclose these requirements to all customers by January 31, 2025, and then annually thereafter.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 14053 is added to the Financial Code, to read:14053. (a) For purposes of this section, the following definitions apply:(1) Fee means a nonsufficient funds fee or an overdraft fee.(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.(c) A state-chartered credit union shall not charge more than three fees per month.(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.
CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION Senate Bill No. 1075Introduced by Senators Bradford and LimnFebruary 12, 2024 An act to add Section 14053 to the Financial Code, relating to credit unions. LEGISLATIVE COUNSEL'S DIGESTSB 1075, as introduced, Bradford. Credit unions: overdraft and nonsufficient funds fees.The California Credit Union Law generally provides for the organization and regulation of credit unions by the Commissioner of Financial Protection and Innovation. Existing law requires a credit union subject to the examination authority of the commissioner to report annually to the commissioner on the amount of revenue earned from overdraft fees and nonsufficient funds fees, as defined and specified.This bill would require a state-chartered credit union to provide a customer at least 5 business days before requiring payment of an overdraft fee or nonsufficient funds fee to give the customer an opportunity to repay the amount that triggered the fee. The bill would prohibit a state-chartered credit union from charging more than 3 of those fees per month. The bill would require a state-chartered credit union to disclose these requirements to all customers by January 31, 2025, and then annually thereafter.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO
CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION
Senate Bill
No. 1075
Introduced by Senators Bradford and LimnFebruary 12, 2024
Introduced by Senators Bradford and Limn
February 12, 2024
An act to add Section 14053 to the Financial Code, relating to credit unions.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 1075, as introduced, Bradford. Credit unions: overdraft and nonsufficient funds fees.
The California Credit Union Law generally provides for the organization and regulation of credit unions by the Commissioner of Financial Protection and Innovation. Existing law requires a credit union subject to the examination authority of the commissioner to report annually to the commissioner on the amount of revenue earned from overdraft fees and nonsufficient funds fees, as defined and specified.This bill would require a state-chartered credit union to provide a customer at least 5 business days before requiring payment of an overdraft fee or nonsufficient funds fee to give the customer an opportunity to repay the amount that triggered the fee. The bill would prohibit a state-chartered credit union from charging more than 3 of those fees per month. The bill would require a state-chartered credit union to disclose these requirements to all customers by January 31, 2025, and then annually thereafter.
The California Credit Union Law generally provides for the organization and regulation of credit unions by the Commissioner of Financial Protection and Innovation. Existing law requires a credit union subject to the examination authority of the commissioner to report annually to the commissioner on the amount of revenue earned from overdraft fees and nonsufficient funds fees, as defined and specified.
This bill would require a state-chartered credit union to provide a customer at least 5 business days before requiring payment of an overdraft fee or nonsufficient funds fee to give the customer an opportunity to repay the amount that triggered the fee. The bill would prohibit a state-chartered credit union from charging more than 3 of those fees per month. The bill would require a state-chartered credit union to disclose these requirements to all customers by January 31, 2025, and then annually thereafter.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 14053 is added to the Financial Code, to read:14053. (a) For purposes of this section, the following definitions apply:(1) Fee means a nonsufficient funds fee or an overdraft fee.(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.(c) A state-chartered credit union shall not charge more than three fees per month.(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 14053 is added to the Financial Code, to read:14053. (a) For purposes of this section, the following definitions apply:(1) Fee means a nonsufficient funds fee or an overdraft fee.(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.(c) A state-chartered credit union shall not charge more than three fees per month.(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.
SECTION 1. Section 14053 is added to the Financial Code, to read:
### SECTION 1.
14053. (a) For purposes of this section, the following definitions apply:(1) Fee means a nonsufficient funds fee or an overdraft fee.(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.(c) A state-chartered credit union shall not charge more than three fees per month.(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.
14053. (a) For purposes of this section, the following definitions apply:(1) Fee means a nonsufficient funds fee or an overdraft fee.(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.(c) A state-chartered credit union shall not charge more than three fees per month.(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.
14053. (a) For purposes of this section, the following definitions apply:(1) Fee means a nonsufficient funds fee or an overdraft fee.(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.(c) A state-chartered credit union shall not charge more than three fees per month.(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.
14053. (a) For purposes of this section, the following definitions apply:
(1) Fee means a nonsufficient funds fee or an overdraft fee.
(2) Nonsufficient funds fee means a fee resulting from the initiation of a transaction that exceeds the customers account balance if the customers credit union declines to make the payment.
(3) Overdraft fee means a fee resulting from the processing of a transaction that exceeds a customers account balance.
(b) A state-chartered credit union shall provide a customer at least five business days before requiring payment of a fee to give the customer an opportunity to repay the amount that triggered the fee.
(c) A state-chartered credit union shall not charge more than three fees per month.
(d) A state-chartered credit union shall disclose the requirements of subdivisions (b) and (c) to all customers by January 31, 2025, and then annually thereafter.