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Updated August 2026.
How much is Ally Bank’s overdraft fee? Ally Bank does not charge an overdraft fee. It eliminated overdraft fees in June 2021 and has not brought them back. If a purchase overdraws your account, Ally either covers it for free through CoverDraft (up to $100, or $250 if you qualify) or moves money in for free from a linked Ally savings or money market account. Ally does not charge a returned-item (NSF) fee either.
| Ally Bank overdraft, at a glance | What it means |
|---|---|
| Overdraft fee | $0. Ally does not charge one, on any transaction type |
| Returned-item (NSF) fee | $0 |
| CoverDraft coverage | Up to $100 automatically once eligible, up to $250 with qualifying direct deposits |
| CoverDraft eligibility | Usually 30 days after depositing $100+ into your Spending Account |
| Overdraft Transfer Service | Free transfer from a linked Ally Savings or Money Market account, rounded up to the nearest $100 |
| Time to fix a negative balance | 14 days before withdrawals may be restricted |
| Account | Figures describe the Ally Bank Spending Account |
Fees verified August 15, 2026 from Ally’s CoverDraft and Overdraft Transfer Service page and Ally’s overdraft protection help page.
Why Ally does not charge an overdraft fee
In June 2021, Ally got rid of overdraft fees for good on its Spending Account. It has kept that promise since. There is no minimum balance to keep and no account tier that brings the fee back. Instead of charging you when you overspend, Ally built two free tools to help: CoverDraft and Overdraft Transfer Service.
How CoverDraft works
CoverDraft is a safety net built into your Spending Account. If a purchase, check, or bill payment would overdraw you, CoverDraft can pay it anyway with no fee, up to your coverage limit.
CoverDraft is a service, not a loan or a guarantee. If a transaction goes over your limit, Ally can still decline it, but you are never charged a fee either way. If you do end up negative, your next deposit is automatically applied to bring the balance back up, and you have 14 days before Ally may restrict withdrawals on the account.
Overdraft Transfer Service
If you link an Ally Savings or Money Market account to your Spending Account, Ally will move money over automatically to cover a shortfall, rounded up to the nearest $100. There is no fee for this transfer. Keep in mind that a savings withdrawal used this way counts toward the 10 withdrawals allowed per statement cycle on that account. If you have both Overdraft Transfer Service and CoverDraft turned on, Ally checks the linked account first and falls back to CoverDraft if there is not enough there.
Does Ally charge a returned-item (NSF) fee?
No. If a payment cannot go through, Ally does not add a fee for that either. This is different from most large banks, which often charge $30 or more for a bounced check or a returned electronic payment.
How to avoid overdraft fees and mistakes
- Turn on balance alerts. Ally can text or email you before a purchase would push you negative.
- Check your CoverDraft coverage. Set up a direct deposit of $250 or more for two straight months to raise your limit from $100 to $250.
- Link a savings account for free transfers. Overdraft Transfer Service moves money in automatically at no cost.
- Fix a negative balance quickly. Ally gives you 14 days before restricting withdrawals, but your next deposit applies automatically.
Short before payday? If the alternative is stacking bank fees, a small advance can be cheaper when you qualify and repay on time.
See how to borrow $50 instantly, or compare every option side by side below.
How this compares to other banks
Overdraft terms vary a lot by bank. Here is how this account lines up against a few others we track, using each bank’s own current fee schedule.
| Bank (typical account) | Overdraft fee | No-fee cushion |
|---|---|---|
| Ally Bank (Spending Account) | $0, none charged | No cap. CoverDraft covers up to $100–$250 |
| Capital One (360 Checking) | $0, no overdraft fee | Fees eliminated |
| Chase (Total Checking) | $34, up to 3/day | $50 buffer + Overdraft Assist |
| Huntington (Asterisk-Free) | $15, up to 3/day | $50 Safety Zone + 24-Hour Grace |
| U.S. Bank (Smartly) | $36 per item over $5 | $50 buffer + Fee Forgiven |
Bankrate’s 2025 Checking Account and ATM Fee Study puts the average U.S. bank overdraft fee at $26.77. This account charges $0, which is $26.77 below that average.
Source: Bankrate 2025 Checking Account and ATM Fee Study, published September 10, 2025.
See fee details for more banks in our overdraft fees by bank comparison.
Compare cash advance apps that can cover a shortfall. If you keep landing in overdraft, an app that fronts you a small amount until payday may cost less than repeat bank fees.
Top cash advance apps right now:
| App | Score | Max | |
|---|---|---|---|
 Tilt |
9.5 | Up to $400 | Get Tilt |
 MoneyLion |
9.1 | Up to $500 | Get MoneyLion |
 Brigit |
9.1 | Up to $500 | Get Brigit |
 Chime |
9.0 | Up to $500 | Get Chime |
 Grant |
8.9 | Up to $500 | Get Grant |
Need more than a few hundred dollars?
- Bigger loans, not tiny advances. Cash advance apps top out fast — PockBox helps you search personal loan offers that often start above $500.
- Any credit score welcome. Compare options from lenders that work with excellent, fair, and poor credit (approval and terms always depend on the lender).
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FAQ
Does Ally Bank charge an overdraft fee?
No. Ally eliminated overdraft fees in June 2021 and has not brought them back on any transaction type.
What is Ally’s CoverDraft service?
CoverDraft covers eligible overdrafts with no fee, up to $100 by default or up to $250 if you set up a qualifying direct deposit of $250 or more for two consecutive months.
How do I qualify for CoverDraft?
Most account holders qualify about 30 days after depositing at least $100 into their Ally Spending Account.
Does Ally charge for overdraft protection transfers?
No. Transfers from a linked Ally Savings or Money Market account to cover a shortfall are free, though they count toward that account’s withdrawal limit.
Does Ally charge a returned-item or NSF fee?
No. Ally does not charge a fee when a transaction cannot be covered.
What happens if I stay negative for a while?
Ally gives you 14 days to bring your balance positive, after which withdrawals may be restricted. Deposits are automatically applied to the negative balance.
