By Isoken Osagie
Ally Financial announced Wednesday that it will be getting rid of overdraft fees entirely — becoming the first large U.S. bank to cut overdraft fees.
NBC News reports that the move is a first for a major financial institution in the U.S. as most banks rely on overdraft fees to increase profits.
“Overdraft fees can be a major cause of anxiety," said Diane Morais, president of consumer and commercial banking at Ally Bank, in a statement. "It became clear to us that the best way to relieve that anxiety was to eliminate those fees."
The new move will impact around 3.6 million checking, savings and money market accounts. However, Ally does not expect it to affect its yearly profit forecasts.
Previously, Ally would charge customers an overdraft fee of $25 per day, as opposed to per transaction.
Those who do overdraft with Ally will likely get their transactions approved depending on the cost and the bank's discretion. Customers will then be given six days to pay for the transaction or bring their account's balance into a positive status, per NBC News.