S.jres18 - Disapproving the rule submitted by the Bureau of Consumer Financial Protection relating to Overdraft Lending: Very Large Financial Institutions. (119th Congress)
Summary
This document is a joint resolution passed by the Senate disapproving a final rule submitted by the Bureau of Consumer Financial Protection (BCFP) regarding overdraft lending practices of very large financial institutions. The rule in question is identified as 89 Fed. Reg. 106768, published on December 30, 2024.
The resolution states that the disapproved rule shall have no force or effect. This action is taken by Congress, indicating an exercise of its oversight authority over regulatory agencies.
The resolution was passed by the Senate on March 27, 2025, during the 1st Session of the 119th Congress.
Expected Effects
The immediate effect of this resolution, if also passed by the House and not vetoed by the President, is to nullify the BCFP's rule on overdraft lending for very large financial institutions. This means that the specific regulations outlined in the disapproved rule will not be enforced.
Financial institutions will not be subject to the requirements of the rule. Consumers may experience changes in overdraft practices depending on how financial institutions respond to the absence of the rule.
Potential Benefits
- Potentially reduces compliance costs for large financial institutions, which they may pass on to consumers.
- May allow banks to offer a wider range of overdraft services, catering to diverse customer needs.
- Could prevent unintended consequences of the rule that might have limited access to short-term credit for some consumers.
- Reinforces congressional oversight of regulatory agencies, promoting accountability.
- Potentially fosters innovation in overdraft products and services.
Most Benefited Areas:
Potential Disadvantages
- May lead to less consumer protection regarding overdraft fees and practices at large banks.
- Could result in higher overdraft fees or more aggressive overdraft lending practices.
- Potentially disproportionately affects low-income individuals who rely on overdraft services.
- May create uncertainty for financial institutions that had already begun to comply with the rule.
- Could undermine the BCFP's authority and ability to protect consumers from unfair financial practices.
Most Disadvantaged Areas:
Constitutional Alignment
The resolution aligns with Article I, Section 1 of the US Constitution, which vests all legislative powers in Congress. This includes the power to oversee and disapprove regulations issued by executive branch agencies like the BCFP.
Congress is exercising its power to check the authority of a regulatory body, ensuring that regulations align with congressional intent. The Congressional Review Act provides a mechanism for Congress to disapprove of agency rules, which is the likely authority being used here.
There is no apparent conflict with the Constitution, as the resolution follows established procedures for congressional oversight.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).