I knew it…
[…] Payday loans have gotten a lot of bad press lately as state governments attempt to crack down on the “legal loansharking” outfits that make very short term loans with interest rates going as high as 500 percent. But a new study by Marc Anthony Fusaro, a professor of economics at East Carolina University, found that the overdraft loans given by banks these days make payday lenders look like a bargain.
[…]While these small fees don’t translate into a ton of money for most consumers, they add up mightily for the banks, and over time, can help trap people in debt that’s hard to escape. The banks don’t make it easy, as they intentionally manipulate check-clearing to encourage people to bounce a lot of checks. (CRL says the software vendors who sell these systems to banks promise to increase revenue from overdraft fees by as much as 400 percent.) […] (highlighting mine)
I’ve been there before. It was just too easy to take advantage of it. Then I saw what it was costing me. Unbelievable. I’m also not surprised that attempts at regulating this went down in flames.