New rule cap NSF fees for overdrawn accounts
· Toronto Sun
OTTAWA — Announced last year, changes to rules concerning how much banks and financial institutions can charge for non-sufficient funds (NSF) came into effect on Thursday.
The new rules, which were published in the Canada Gazette in March 2025, amended the Financial Consumer Protection Framework Regulations to cap fees charged by banks and financial institutions to no more than $10 for instances where a customer doesn’t have enough funds in their account to cover payments drawn from the same account.
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The rules also bar banks and financial institutions from charging that fee more than once in a two business day time span, or when the amount being overdrawn is less than $10.
Rules aim to reduce crippling NSF fees
Customers who overdraw their accounts previously could have repeating fees upwards of $50 — and the measures are meant to make life easier for the increasing number of Canadians living paycheque to paycheque.
In a statement from the Finance Department, Finance Minister François-Philippe Champagne said the move will make life easier for those struggling amidst Canada’s inflation-fuelled cost of living crisis.
“Even if someone is just $5 short when paying a bill or covering a cheque, they can be hit with a non-sufficient funds fee as high as $50 — that’s money that could otherwise go toward groceries, medicine, or other everyday essentials,” Champagne said, adding that more than one in three Canadians are impacted by these high NSF fees.
“By capping NSF fees at $10 and strengthening consumer protections, we’re helping Canadians keep more of their hard-earned money while making everyday banking fairer and more affordable.”
Part of new measures intended to save Canadians money
The NSF fee cap is part of a series of banking regulations introduced by the Mark Carney Liberals, including low- and no-cost bank accounts introduced last December, which allow Canadians to access banking services with fees as lot as $4 per month.
Zero fee accounts are also available for Canadian students, youth, seniors and beneficiaries to the Registered Disability Savings Plan.
As well, recently-passed legislation increased the amount of immediately-available deposited funds from $100 to $250, allowing for faster access to money deposited in bank accounts.