The CFPB  withdrew today a proposed rule that would have considered any non-sufficient funds (NSF) fees for transactions declined in real time as unlawful under the Consumer Financial Protection Act.

The proposal would have prohibited financial institutions from engaging in this practice across all instantaneously declined transactions, regardless of transaction method, including declined debit card purchases, ATM withdrawals, and some declined peer-to-peer payments.

In comments submitted to the bureau, America’s Credit Unions noted concerns with the proposal’s broad unfair, deceptive, and abusive acts or practices (UDAAP) approach. The bureau was unable to find any evidence that charging these types of fees is a common practice which matched feedback from the credit union community.