The Senate voted Thursday to strike down a rule capping most bank overdraft fees at $5, a measure adopted late final yr by the Shopper Monetary Safety Bureau that had been anticipated to save lots of Individuals billions of {dollars} per yr.

Senator Josh Hawley, Republican of Missouri, was the lone Republican to oppose the decision, which handed on a virtually party-line vote, 52-48. It is going to now transfer to the Home, the place Consultant French Hill, the Arkansas Republican who leads the Monetary Service Committee, launched a parallel decision final month.

The rule would have restricted the charges banks and credit score unions might cost when prospects spend greater than they’ve of their accounts, usually $35 per overdraft. The bureau estimated it might save American households $5 billion a yr. It was instantly challenged in courtroom by banking commerce teams.

The decision was performed by way of the Congressional Evaluation Act, a 1996 legislation that allows lawmakers to reverse just lately adopted laws with a easy majority vote. It can’t be filibustered. The overdraft rule, which the patron bureau finalized in December after years of preparatory work, was scheduled to take impact in late 2025.

Democrats are getting ready to combat the decision within the Home, the place they hope the slim Republican majority will work of their favor.

The American Bankers Affiliation, a plaintiff within the lawsuit, praised the Senate’s motion.

“If carried out, the C.F.P.B.’s Eleventh-hour rule imposing authorities value controls would pressure many banks to restrict or remove overdraft safety as we all know it,” stated Rob Nichols, the commerce group’s chief government. “Many Individuals can be pushed to much less regulated and better threat non-bank lenders to cowl surprising or emergency bills.”

Shopper advocates stated the rule’s elimination would permit banks and credit score unions to proceed charging charges far increased than their precise prices for the service.

“Repealing the C.F.P.B.’s overdraft charge limits will harm working households who’re already battling excessive costs and inflation,” stated Chuck Bell, the advocacy program director at Shopper Studies.