ABA Unveils Consumer Survey Data on Debit Cards, Overdraft and Other Banking Issues in Play in Washington

In the wake of the Federal Reserve’s recent proposal to further lower the price cap on the debit interchange merchants pay to process debit card transactions, a new survey conducted by Morning Consult on behalf of the American Bankers Association finds that consumers are happy with their debit cards and think the government should leave the debit card payment system alone. U.S. adults overwhelmingly said they are satisfied with the ease of use when making a purchase with their debit card (86%), the security of their financial information when they use their debit card (81%), and the speed of the transaction when using their debit card (86%). Only one in five respondents (21%) support the government making changes to the debit card system.

Following the Federal Reserve's price cap on debit interchange rates merchants pay to process debit card transactions in 2011, retailers promised to lower prices for consumers, but failed to deliver. According to this survey, only 4% of respondents say they experienced lower prices as a result of the price cap, with nearly 10 times as many consumers saying prices actually increased. Only 12% of respondents think retailers will lower prices if the Federal Reserve further caps interchange rates, while 34% think they will raise prices and 36% think they will keep them the same.

“More than a decade’s worth of evidence makes clear that government price controls on debit interchange benefit no one other than large retailers,” said Rob Nichols, ABA president and CEO. “This survey shows the wide disconnect between what retailers have claimed and what consumers have actually experienced. Consumers are happy with their debit card and don’t want the government to interfere in a system that is working extremely well and meeting their payments needs.” 

U.S. Adults Value Overdraft Protection and Want It To Remain an Option

The survey also shows a strong majority of Americans appreciate and value bank overdraft programs. More than two-thirds of consumers (67%) find their bank’s overdraft protection valuable – as compared with only 16% who do not find it valuable – and 8 in 10 consumers (79%) who have paid an overdraft fee in the past year were glad their bank covered their overdraft payment, rather than returning or declining payment. Sixty-four percent of consumers think it’s reasonable for banks to charge a fee for an overdraft, as opposed to only 23% who think it’s unreasonable, and nearly three-quarters (72%) view overdraft fees as reasonable when considering that large payments like mortgages or rent payments are covered and paid on time or that customers are protected from late or other penalty fees if payments overdraft a customer’s account (71%).

The vast majority of consumers (88%) said it is easy for them to check their account balance so that they can avoid overdrawing their account. Two-thirds (65%) of respondents are aware that customers can opt out of receiving overdraft protection at any time after they’ve accepted the service, as compared with only 7% who incorrectly believe that customers are required to stay in the program once they accept the service. Of those respondents who are currently enrolled in overdraft protection, four in five consumers (78%) have never seriously considered stopping or getting out of the service. A strong majority (69%) said they prefer that their bank offer overdraft protection as an option to customers whether there is a fee or not, as opposed to only 13% who prefer that their bank not offer overdraft protection at all.

“As the CFPB continues to demonize highly regulated products like overdraft protection and proposes regulations that will make it significantly harder for banks to offer this service, this survey shows that the Bureau is out of touch with the people they are supposed to represent,” said Nichols. “The vast majority of U.S. adults have made it clear that overdraft protection is a useful tool that is offered at a reasonable cost.” 

Consumers Think Congress Should Examine Credit Unions’ Tax Exemption and Allow Cannabis Banking

U.S. consumers are generally unaware of the differences between banks and credit unions and believe credit unions should be held to the same standards as the banks they compete with for customers every day. A wide majority of respondents (67%) said that Congress should examine whether credit unions are providing enough community benefit to warrant their existing tax exemption, while only 14% opposed such an examination. It has been nearly 20 years since Congress last held a hearing to conduct oversight of the federal tax exemption that credit unions receive.

Additionally, only 20% of Americans are aware that credit unions do not pay federal taxes, while 80% are unaware of credit unions’ tax status. In fact, nearly a third of consumers mistakenly thought that credit unions do pay federal taxes. Of those surveyed, just 19% believe credit unions should not pay federal taxes. A majority of consumers also believe that credit unions should be subject to community reinvestment reporting requirements that quantify their impact on all segments of their communities, including low- and moderate-income areas, just like banks are (55% in support vs. 16% in opposition, respectively).

“The last time Congress held an oversight hearing on credit unions the first iPhone was still two years away from hitting the market,” said Nichols. “Since that time, the credit union industry has exploded, increasingly prioritizing growth by advocating for looser membership rules, raising money from investors, and even buying up taxpaying banks. This runs contrary to their congressionally mandated mission to prioritize service to lower- and middle-income communities. Americans agree that it’s time for Congress to finally hold credit unions accountable.”

The data released today also indicate that by greater than a 3-to-1 margin (63% support vs. 17% oppose) U.S. adults support Congress passing legislation that allows cannabis businesses to access banking services and financial products like checking accounts and business loans in states where cannabis is now legal.

“Americans have made it clear that Congress should resolve the ongoing conflict between state and federal law on cannabis banking issues by passing legislation that will enhance public safety, tax collection and transparency,” said Nichols.

The data released today is the latest in a series of results gauging U.S. consumers’ preferences and opinions regarding banks and their services. Yesterday, ABA released additional survey data revealing that Americans are happy with their bank and the multitude of financial services available to them, are confident their deposits are safe, and value the benefits of their credit cards including rewards. The full results for today’s survey questions are as follows:

When asked “Thinking more specifically about your bank or financial institution, how satisfied are you with the following? Products offered, such as credit or debit cards or specialized accounts” respondents provided the following responses:

• Very satisfied – 35%
• Somewhat satisfied – 43%
• Not very satisfied – 8%
• Not at all satisfied – 2%
• Don’t know/no opinion – 12%

When asked “Thinking more specifically about how you use your debit card, how satisfied are you with each of the following? — Ease of use when making a purchase” respondents provided the following responses: 

• Very satisfied – 57%
• Somewhat satisfied – 29%
• Not very satisfied – 5%
• Not at all satisfied – 1%
• Don’t know/no opinion – 8%

When asked “Thinking more specifically about how you use your debit card, how satisfied are you with each of the following? — Security of your financial information” respondents provided the following responses: 

• Very satisfied – 46%
• Somewhat satisfied – 35%
• Not very satisfied – 6%
• Not at all satisfied – 2%
• Don’t know/no opinion – 10%

When asked “Thinking more specifically about how you use your debit card, how satisfied are you with each of the following? — Speed of the transaction” respondents provided the following responses:

• Very satisfied – 56%
• Somewhat satisfied – 30%
• Not very satisfied – 4%
• Not at all satisfied – 1%
• Don’t know/no opinion – 8%

When asked “Which of the following comes closest to your view, even if neither is exactly right?” consumers provided the following answers:

• I value the safety, convenience and other benefits that come from my debit card and the government should leave the debit card payment system alone. – 55%
• The federal government needs to make changes to the debit card payments system. – 21%
• Don’t know/No opinion – 24%

When asked “Following the Federal Reserve’s price cap on interchange rates merchants pay to process debit card transactions in 2011, retailers promised to lower prices for consumers. Since that time, have you experienced lower prices, higher prices, or the same prices from retailers?” respondents provided the following responses:

• Higher prices – 39%
• The same prices – 36%
• Lower – 4%
• Don’t know/no opinion – 21%

When asked “If the Federal Reserve further caps interchange rates merchants pay to process debit card transactions, do you expect retailers to lower prices, raise prices, or keep prices the same?” consumers provided the following responses:

• Raise prices – 34%
• Keep prices the same – 36%
• Lower prices – 12%
• Don’t know/no opinion – 18%

When asked “How valuable do you find the overdraft protection offered by your bank?” consumers provided the following responses:

• Very valuable – 32%
• Somewhat valuable – 35%
• Not too valuable – 9%
• Not valuable at all – 7%
• Don’t know/no opinion – 18%

When asked “Regarding the bank covering your overdraft payment, were you glad the payment was covered, or would you have preferred the bank return or decline the payment?” consumers who have paid an overdraft fee in the past year provided the following answers:

• Glad the payment was covered – 79%
• Would have preferred the bank returned or declined the payment – 17%
• Don’t know/no opinion – 4%

When asked “How reasonable is it, in your opinion, for banks to charge fees for overdrafts?” consumers provided the following answers:

• Very reasonable – 26%
• Somewhat reasonable – 38%
• Somewhat unreasonable – 14%
• Very unreasonable – 9%
• Don’t know/no opinion – 12%

When asked “Knowing each of the following, how reasonable is it, in your opinion, for banks to charge fees for overdrafts? — Overdraft protection from banks ensures customers’ large payments such as mortgages or rent payments are covered and paid on time in the event these payments overdraft a customer’s account,” consumers provided the following answers:

• Very reasonable – 34%
• Somewhat reasonable – 38%
• Somewhat unreasonable – 8%
• Very unreasonable – 6%
• Don’t know/no opinion – 16%

When asked “Knowing each of the following, how reasonable is it, in your opinion, for banks to charge fees for overdrafts? — Overdraft protection from banks protects customers from late or other penalty fees if payments overdraft a customer’s account,” consumers provided the following answers:

• Very reasonable – 31%
• Somewhat reasonable – 40%
• Somewhat unreasonable – 9%
• Very unreasonable – 6%
• Don’t know/no opinion – 15%

When asked “How easy is it for you to check your account balance, so that you can avoid overdrawing your account?” consumers provided the following responses:

• Very easy – 71%
• Somewhat easy – 17%
• Somewhat difficult – 4%
• Very difficult – 1%
• Don’t know/no opinion – 7%

When asked “To your knowledge, can customers opt out of receiving overdraft protection at any time, or are they required to stay in the program once they accept this service, or are you not sure?” consumers provided the following responses:

• Customers can opt out – 65%
• Customers can’t opt out – 7%
• Don’t know/no opinion – 28%

When asked “Have you seriously considered stopping or getting out of your bank’s overdraft protection service?” consumers enrolled in overdraft protection service provided the following responses:

• Yes – 13%
• No – 78%
• Don’t know/no opinion – 9%

When asked “To your knowledge, can customers opt out of receiving overdraft protection at any time, or are they required to stay in the program once they accept this service, or are you not sure?” consumers provided the following responses:

• Customers can opt out – 65%
• Customers can’t opt out – 7%
• Don’t know/no opinion – 28%

When asked “It has been nearly 20 years since Congress last held a hearing to conduct oversight of the federal tax exemption that credit unions receive. Do you agree or disagree that Congress should examine whether credit unions are providing enough community benefit to warrant receiving their tax exemption?” consumer provided the following answers: 

• Strongly agree – 28% 
• Somewhat agree – 39% 
• Somewhat disagree – 9% 
• Strongly disagree – 5%
• Don’t Know/No Opinion – 20% 

When asked “To the best of your knowledge, which of the following best describes how credit unions pay federal taxes?” consumers provided the following answers:

• Credit unions do not pay federal taxes – 20% 
• Credit unions pay federal taxes – 27% 
• Don’t Know/No Opinion – 53%

When asked “Knowing what you know about the similarities between credit unions and banks, which of the following comes closest to your view, even if neither is exactly right?” consumers provided the following answers:

• Credit unions should pay federal taxes just like banks – 50%
• Credit unions should not pay federal taxes just like banks– 19%
• Don’t Know/No Opinion – 30%

When asked “Knowing what you know about the similarities between credit unions and banks, which of the following comes closest to your view, even if neither is exactly right?” consumers provided the following answers:

• Credit unions should be subject to community reinvestment reporting requirements that quantify their impact on all segments of their communities, including low- and moderate-income areas, just like banks. – 55%
• Credit unions should not be subject to community reinvestment reporting requirements that quantify their impact on all segments of their communities, including low- and moderate-income areas, just like banks. – 16%
• Don’t Know/No Opinion – 29%

When asked “Do you support or oppose allowing cannabis businesses to access traditional banking services, like a checking account or business loan, in states where cannabis is now legal?” consumers provided the following responses:

• Strongly support – 37%
• Somewhat support –26%
• Somewhat oppose – 9%
• Strongly oppose – 9%
• Don’t know/no opinion – 19%

When asked “Do you support or oppose Congress passing legislation that allows cannabis businesses to have access to banking services and financial products (like checking accounts and business loans) in states where cannabis is legal?” consumers provided the following responses:

• Strongly support – 36%
• Somewhat support –27%
• Somewhat oppose – 8%
• Strongly oppose – 9%
• Don’t know/no opinion – 20%

About the Survey

This poll was conducted by Morning Consult on behalf of the American Bankers Association from March 8-10, 2024, among a national sample of 4,423 adults split into two representative groups for specific question sets (Split Sample A n=2,222 | Split Sample B n=2,201). The interviews were conducted online and the data were weighted to approximate a target sample of adults based on age, race/ethnicity, gender, educational attainment, and region. Results from the full survey have a margin of error of plus or minus 1 to 2 percentage points.