DV Journal

At my credit union, I see it happening every day. One unexpected expense—a medical bill, a utility payment, or a car repair—can throw a family’s budget into chaos. When that happens, people need safe options they can trust.

That’s why overdraft protection matters to the people we serve. It is a choice, and one they make voluntarily because it provides flexibility, peace of mind, and a safeguard against more severe financial consequences.

Now that choice is under threat. House Bill 1553, advancing in the Pennsylvania House of Representatives, will not help our members. It will harm them. As a leader of a community-based financial institution, I feel an obligation to speak up. The voices of our members deserve to be heard.

We Know What Our Communities Need

In my institution, transparency is non-negotiable. Our members know the terms of their accounts and services, and they choose whether to participate in overdraft programs. They opt in because it offers control and protection, not because anyone forces them to do so.

Across the state, these services are helping families keep their financial lives on track. According to a 2023 national survey, 89 percent of consumers find overdraft protection valuable, particularly when it helps cover critical expenses such as rent, groceries, or medical bills.

We see how this protection prevents missed payments, late fees, and the damaging financial ripple effects that can result. Without it, many consumers would face much worse alternatives. The Pew Charitable Trusts found that 12 million Americans turn to payday loans annually, often because safer options are unavailable. Removing access to overdraft services risks pushing more Pennsylvanians toward these high-cost, unregulated products.

A Bill with Real Harmful Consequences

We understand the desire to protect consumers. We share that goal. But House Bill 1553 will not accomplish it.

The bill imposes unrealistic fee caps and notification requirements that credit unions simply cannot operationally support. It will severely limit our ability to recover the actual costs of providing these protective services. If enacted, we will face difficult choices. Free checking may no longer be sustainable. Fees may rise in other areas. Offering overdraft protection at all may no longer be viable.

In every scenario, the result is the same: the people who rely on these services will lose options and face greater financial risk.

An Unfair Playing Field

House Bill 1553 would also create an uneven playing field. Its restrictions would not apply to national banks or federally chartered credit unions, which are exempt under federal preemption. State chartered banks and credit unions would bear the full burden of this legislation, and may be forced to consider switching to federal charters to avoid these restrictions. That is not good for Pennsylvania’s financial system or for the customers and members we serve.

This is not theoretical. Even the bill’s supporters have acknowledged that federal preemption will apply, yet they have dismissed the likelihood of charter switching. We believe this is a very real risk with serious consequences.

Our Message to Lawmakers

We are committed to helping our members build financial capability and stability. We offer education, transparency, and services designed to empower them, not trap them.

HB 1553 would take away one of those tools and leave many Pennsylvanians worse off, not better.

We urge lawmakers to listen to the voices of community bankers, credit union leaders—and, most importantly—to the voices of those we serve.

We see what is at stake every day. This bill will not help, it will hurt. And we respectfully urge the House to reject it.