NEW YORK — Bank of America plans to test a program that will let customers approve debit-card purchases that exceed their balances by text message.
The news comes a year after the bank stopped permitting transactions that overdraw a customer’s account at the register. At the time, Bank of America touted the decision as a consumer-friendly policy that would prevent customers from unknowingly overdrafting their checking accounts and incurring penalty fees.
The company’s decision was also a response to regulatory changes. A rule that went into effect last summer prohibits banks from enrolling customers in overdraft programs without their active consent.
Under the new pilot program, Bank of America says customers would be fully aware that approving an overdraft would result in a $35 fee.
To start, customers will have to sign up for the program. If they then try to make a purchase that’s declined at the register, they would immediately get a text from Bank of America asking if they want the purchase to go through.
The text would notify customers of the overdraft fee.
The customer’s approval would be good only for that particular transaction. If a customer replaced the money in their checking account by the end of the day, they would not be charged the fee.
Bank of America plans to roll out the pilot early next year but declined to give details on the scope and duration of the test. Customers at Bank of America can currently overdraw their accounts only at ATMs, where they are first notified of the $35 fee.
