If I dont have the money block the transaction and offer a line of credit with specific apr for those that want to be able to overdraft.
It's a felony to write a check that you don't have the funds for.
Oh, you mean for the bank.
Edit: Here in Europe no one uses checks since I can remember (since the 80s?). In Switzerland lots of cash and direct bank transfers.
Yes, definitely! Not that common, but sometimes useful for big in-person purchases or down payments. I have needed to write one maybe once in the last five years. Banking apps let you deposit by taking a picture.
But I’ve received a few checks as gifts or payment.
So yeah, they're pretty common here still, mostly in businesses that haven't kept up with the times.
Of course. I was stuck behind an older lady writing one for groceries, just the other day.
Banks see it as a source of revenue. I don't have sources, but I recall stories where debit transactions were processed out of chronological order and caused overdrafts which then kicked off hefty fees for overdrafts of something like a dollar.
Having a bank service break and causing your funds to be unavailable, or having negligent processing that can't keep up with modern banking, is much different than passing hot checks.
That's because it was automatically enabled by default. This is what banks would do if they weren't predatory.
I'd agree with the idea of avoiding overdraft entirely unless a customer signs up for it. I don't want transactions I can't afford to go through. I manage my accounts quite closely. For me such situation would be 99% an unintended transaction that I would like to cancel.
By letting such requests go through, banks put the burden on the customers to clean up after a wrong or, in many cases, illegal transaction.
YMMV.
I had a bank charge me an overdraft fee. I asked them to show me my overdraft authorization.
It's amazing how fast a bank can return money when they screw up.