(Bloomberg) -- Wells Fargo (NYSE:WFC) & Co. and Citigroup Inc (NYSE:C). said they’re making adjustments to ensure stimulus payments are received in full by checking-account customers with negative balances.
Wells Fargo is setting aside negative balances for 30 days, while Citigroup said it will provide a temporary provisional credit against a negative balance to give customers full access to their payments. The firms are deviating from the typical practice of deducting a negative balance from incoming payments.
“The goal is to get money in consumers’ hands as easily and quickly as possible,” Ed Kadletz, Wells Fargo’s head of the deposit products group, said in an interview.
This week, millions of Americans began receiving payments of as much as $1,200 through government efforts to rejuvenate the economy amid the coronavirus pandemic. For many, payments were automatically deposited into checking accounts. Banks had faced criticism amid speculation that those with overdrawn accounts would lose part or all of their payments.
Wells Fargo gathered a record amount of deposits on Wednesday as customers received the payments and tax refunds from the Internal Revenue Service, Kadletz said. The San Francisco-based lender said it will also cash stimulus checks for people without Wells Fargo accounts -- and won’t charge them fees -- at its sprawling network of bank branches.
At JPMorgan Chase (NYSE:JPM) & Co., some customers with negative balances will see their payment returned to the Treasury Department in full. That allows the government to mail the check instead, JPMorgan said in an email.
Consumers can also receive stimulus payments through a prepaid card, or in their PayPal Holdings Inc (NASDAQ:PYPL). and Square Inc (NYSE:SQ). digital wallets.
“The number-one preferred method is direct deposit into a current banking account,” said Kim Bynan, head of prepaid and government solutions at financial-technology firm FIS. “But it doesn’t hit on all of the individuals in America. There are individuals that are under-banked or unbanked. From a prepaid perspective, we’ve pushed the need for another disbursement tool.”
(Updates with Wells Fargo cashing stimulus checks for non-customers in fifth paragraph.)
©2020 Bloomberg L.P.
