In personal banking, a fee a bank may charge when a transaction exceeds the available account balance is an overdraft fee.
An overdraft occurs when an account transaction would take the balance below zero or beyond an approved limit. Depending on the account and bank, the transaction may be paid, declined, or covered through linked savings or an overdraft line of credit.
Fees and policies vary by institution and jurisdiction. Some banks offer overdraft protection, while others may charge separate fees for returned payments or insufficient funds. Consumers should check whether debit-card transactions, checks, recurring payments, and ATM withdrawals are treated differently.
An overdraft fee is not the same as an account maintenance fee. Maintenance fees are charged for holding or using an account, while overdraft charges are connected to transactions exceeding available funds or arranged limits.