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Wells Fargo starts small-dollar loans amid overdraft scrutiny

Published 11/16/2022, 09:04 AM
Updated 11/16/2022, 09:08 AM
© Reuters. FILE PHOTO: A Wells Fargo logo is seen at the SIBOS banking and financial conference in Toronto, Ontario, Canada October 19, 2017.  REUTERS/Chris Helgren/File Photo

By Lananh Nguyen

NEW YORK (Reuters) - Wells Fargo (NYSE:WFC) & Co introduced small-dollar loans to customers online, the bank said Wednesday, as overdraft fees draw greater scrutiny in the United States.

© Reuters. FILE PHOTO: A Wells Fargo logo is seen at the SIBOS banking and financial conference in Toronto, Ontario, Canada October 19, 2017.  REUTERS/Chris Helgren/File Photo

The loans are for $250 or $500 with a flat fee of $12 or $20, respectively, to eligible customers, the bank said. The loans are already available in a limited number of markets and will be offered nationwide by year-end.

The Biden administration has pledged to crack down on so-called surprise "junk fees" such as overdrafts that can catch customers off guard. Some major banks have responded by scrapping overdrafts altogether, reducing charges or changing policies to allow customers to opt in or out of the services.

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