Citizens Bank allows overdrafts on checking accounts, but only if you opt in to overdraft protection
Citizens Bank does not automatically cover overdrafts. By default, if you try to spend more than you have, the transaction will be declined. However, Citizens Bank offers overdraft protection, which is a service you can turn on that allows transactions to go through even when your balance would go negative. You have to request this service — it does not happen on its own.
The catch is that overdrafts cost money. Citizens Bank charges an overdraft fee each time you overdraft, and the amount varies depending on which type of account you have and how the overdraft happens. You also pay interest on the negative balance until you bring the account back to zero.
Key Takeaways
- Overdraft protection is optional at Citizens Bank and must be turned on through your online account settings or by calling customer service.
- Citizens Bank charges an overdraft fee for each transaction that overdraws your account, with fees ranging based on your account type.
- You will also owe interest on the negative balance, calculated daily until you deposit enough money to bring the account positive.
- Without overdraft protection enabled, transactions will straightforward decline rather than overdraft, which protects you from fees but may cause payment failures.
- You can turn overdraft protection on or off at any time, and Citizens Bank allows you to set a maximum overdraft limit.
How to turn overdraft protection on or off
You can manage overdraft protection through Citizens Bank's online banking portal or mobile app. Log into your account, navigate to your checking account settings, and look for the overdraft protection option. You will see a toggle or checkbox to enable or disable the service. If you prefer to speak with someone, call Citizens Bank customer service at the number on the back of your debit card and ask them to turn overdraft protection on or off for you.
When you enable overdraft protection, Citizens Bank will ask you to set a maximum overdraft limit — the most you are willing to go negative. This is a safety measure that prevents you from overdrafting by thousands of dollars. The limit you set is up to you, but Citizens Bank may suggest a range based on your account history.
What overdraft fees cost and how they add up
Citizens Bank charges a fee each time a transaction overdraws your account. The exact amount depends on your account type — some checking accounts have lower overdraft fees than others. As of the most recent information available, Citizens Bank's overdraft fees typically range from $25 to $35 per transaction, but you should confirm the current fee for your specific account by checking your account agreement or calling customer service.
The fees can accumulate quickly. If you overdraft five times in a month, you could owe $125 to $175 in fees alone, on top of the interest you owe on the negative balance. Citizens Bank calculates interest daily on the overdraft amount, so the longer you stay negative, the more interest you pay. This is why overdraft protection is useful in emergencies but expensive as a regular habit.
Alternatives to overdraft protection
If you want to avoid overdraft fees altogether, you have other options. The simplest is to keep overdraft protection turned off and let transactions decline when you do not have enough money. This prevents fees but may cause problems — for example, a bill payment might fail, or a debit card transaction could be rejected at checkout.
A second option is to link a savings account or credit card to your checking account as a backup. Some banks offer overdraft transfer protection, which automatically moves money from your savings account to your checking account if you overdraft, rather than charging a fee. Citizens Bank may offer this service — ask customer service whether it is available for your account and how to set it up.
A third option is to use a line of credit or credit card for unexpected expenses instead of relying on overdraft protection. This gives you more control over when you borrow and what interest rate you pay.
What happens if you overdraft without protection enabled
If overdraft protection is off and you try to spend more than your balance, the transaction will be declined. Your debit card will be rejected at the register, or your online bill payment will not go through. This is inconvenient in the moment, but it protects you from fees and keeps you from going into debt to your bank.
Some merchants and billers will retry a declined payment automatically, so you may get a second chance. Others will not, and you will have to contact them to reschedule or resubmit the payment. Check your account regularly so you know your balance and can avoid declined transactions.
How to recover from an overdraft
If you have overdrawn your account, the fastest way to fix it is to deposit money as soon as possible. Citizens Bank will explore your deposit to the negative balance first, then to any fees and interest owed. Once your balance is positive again, the overdraft protection stops working until you overdraft again.
If you cannot deposit money when ready, contact Citizens Bank and explain your situation. Some banks will waive one or two overdraft fees per year if you have a good account history, though Citizens Bank's policy on this varies. It never hurts to ask, especially if the overdraft was caused by an error on the bank's part or a legitimate emergency.
Frequently Asked Questions
Can Citizens Bank overdraft my account without my permission?
No. Citizens Bank will not overdraft your account unless you have explicitly turned on overdraft protection. If protection is off, transactions will decline instead. You are in control of whether overdrafts are allowed.
How long do I have to pay back an overdraft?
There is no set important date, but interest accrues daily on the negative balance. The sooner you deposit money to bring your account positive, the less interest you will owe. Citizens Bank does not typically close an account for being overdrawn, but if you stay negative for an extended period, the bank may take action.
Will an overdraft hurt my credit score?
An overdraft at Citizens Bank will not directly appear on your credit report or hurt your credit score, because it is an internal bank matter, not a loan or line of credit. However, if Citizens Bank sends your account to a collection agency because you do not pay back the overdraft, that can damage your credit.
Can I set a limit on how much I can overdraft?
Yes. When you enable overdraft protection, you set a maximum overdraft limit. Citizens Bank will not allow transactions that would push you beyond that limit. You can change this limit at any time through your online account or by calling customer service.
What is the difference between overdraft protection and overdraft fees?
Overdraft protection is the service that allows transactions to go through when you do not have enough money. Overdraft fees are the charges Citizens Bank levies each time you use that protection. You can have protection enabled without using it — you only pay fees when you actually overdraft.