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It’s possible to overdraft your account with a debit card if you have signed up for your bank’s overdraft coverage, which can enable a transaction to go through even when the account is short of the funds needed to cover it. However, you may wind up paying expensive overdraft fees on your purchase or withdrawal.

Overdraft fees have been around for so long now, many consumers may simply accept them as a cost of doing business with their bank or credit union. But you may not want to do so. Read on for a closer look at what opting into your bank’s overdraft service could mean specifically for debit card transactions.

What Does It Mean to Overdraft With Your Debit Card?

Overdrafting with a debit card means that you may spend more money than you actually have in the account.

If you don’t have enough money in your bank account to cover a debit card transaction, you can expect one of two things to happen.

•  Your bank may decline your request, leaving you empty-handed at the cash register or ATM.

•  Your bank could allow the transaction to go through. Technically, you will have overdrawn your account, because your account balance will fall below zero. But you’ll get what you wanted — some cash, a latte, movie tickets, etc. And you’ll be saved from potential embarrassment in front of co-workers or friends.

The second outcome may seem more satisfying, at least for the short-term. But there’s a catch: Your bank may only let the transaction go through if you participate in its overdraft coverage or protection program, and you can be charged a fee for this service.

What Is Overdraft Coverage vs. Overdraft Protection?

Many financial institutions offer overdraft programs that will let your transactions go through, at least temporarily, if you don’t have enough money in your account. But the rules — and fees — for this service can vary significantly from one bank and bank account to the next, so it’s important to understand what you’re signing up for.

Standard Overdraft Coverage

Many banks offer some type of standard overdraft coverage for their consumer checking accounts. Generally, if you overdraw your account with a check, automatic bill payments, or recurring debit card transactions, the bank may process the transaction anyway (at its discretion and usually up to a certain limit). But it will typically cost you: Your bank may charge an overdraft fee. And you’ll still have to get your account back in the black ASAP to avoid multiple fees. So while you can overdraft a debit card with no money in your account, it can get pricey.

Overdraft Protection

Overdraft protection services work a little bit differently. With this type of program, you can designate a backup account (a savings account, credit card, or line of credit, for example) to cover any shortfalls. The bank will automatically transfer money to your overdrawn checking account.

You’ll likely still be charged for this service, but this “transfer fee” may be lower than the bank’s overdraft fee. Before opting into any overdraft program, it’s important to understand the specific terms and fees.

How Are Debit Card Overdrafts Different?

You may not have a choice when it comes to paying fees when you overdraw your account with a check or automated clearing house (ACH) payments. If the bank approves the transaction, you can expect to pay an overdraft fee. If it declines the transaction, you’ll likely face a non-sufficient funds (NSF) fee. This charge means that even though the transaction wasn’t completed, you still will pay for the inconvenience the bank experienced due to the situation.

But your bank can’t charge you fees for overdrafts on most debit card transactions unless you have specifically opted in to those charges.

Opt-In vs. Opt-Out Policies

Deciding whether you want or don’t want to pay overdraft fees on debit card transactions can be a pretty complicated decision. Policymakers at the Federal Reserve decided in 2010 to change the previous process that involved having to opt out of overdraft coverage (that is, customers could be automatically enrolled in the service). Since then, bank customers have to opt in by signing paperwork that says they understand the fees and they want their bank to process their debit card transactions even when they’re short of funds.

•  If you opt in to debit card and ATM overdraft coverage, you can expect withdrawals and purchases to go through even if you don’t have enough funds in the bank at the time of the transaction. But you will likely be charged a fee in exchange for this service. (See below for pricing specifics.)

•  If you don’t opt in to debit card and ATM overdraft coverage, you may experience one-time ATM withdrawals and debit purchases being declined if you don’t have enough money in your account at the time of the transaction. You can avoid paying an overdraft fee for those transactions, but it will be up to you whether you want to use a credit card or some other method to complete the transaction.

•  Keep in mind, though, that even if you don’t opt in to overdraft coverage for your debit card, you could still face fees. If you’re short of funds when the bank processes an automatic payment through your debit card — for a gym membership or subscription service, for example — you might face an overdraft fee if the bank chooses to complete the transaction. And if the payment is declined, you may be charged an NSF fee.

Recommended: How to Get a Debit Card

Costs and Fees Associated With Overdraft Services

Federal regulators have proposed lowering overdraft fees to as little as $3, but currently they average around $26 to $27. And though some banks don’t charge overdraft fees on checking accounts, 94% of accounts at financial institutions still have them, according to a recent survey. And they can run as high as $38 or so.

Some banks also may charge what are known as “continuous” overdraft fees, or daily overdraft fees. These are charges assessed every day the account remains overdrawn, and the fees can add up quickly.

Your bank may waive the fee on a smaller purchase. Also, if it’s the first time you’ve overdrawn your account — or it’s been a while since you did so — the bank might remove the fee if you call and ask.

Should You Overdraft With a Debit Card?

If you’ve opted in to debit card overdraft coverage, it may seem worth the risk of overdrafting if you need some quick cash or to fill your gas tank in a pinch when you’re low on funds. But if you have other resources (whether it’s a credit card or a piggy bank), you might want to tap those first. Keep potential fees in mind — not to mention the stress of knowing your checking account will have a negative balance — as you ponder this strategy.

Recommended: 10 Personal Finance Basics

How to Avoid Overdraft Fees

Understanding how opt-in overdraft coverage works is one way to avoid triggering unnecessary bank fees. But there are other proactive steps you may want to consider, as well, including the following:

Choose a Bank That Doesn’t Charge Overdraft Fees

Some banks don’t charge overdraft fees; often, they cover you up to a specific overdraft limit, such as $50. Others may offer one or two fee-free account options. (If bank fees overall are an issue for you, keep in mind that online banks often have lower costs than traditional brick-and-mortar institutions.)

Use Credit Cards for Emergency Expenses

If you have a relatively low-interest credit card or you’re able to pay off your credit card balance every month to avoid accruing interest, it may make sense to use your credit card for emergency expenses. Thinking about which card you’re going to use before an emergency comes up could help you make the best decision.

Link Accounts for Overdraft Protection

Linking your checking and savings accounts can allow your bank to quickly move funds to cover negative balances. Though you might pay a transfer fee, it’s usually less than an overdraft fee.

Build an Emergency Fund

Having an emergency fund that can cover three to six months’ worth of expenses is a good goal, but even a smaller amount of savings may allow you to deal with the kinds of unexpected expenses that can trigger debit card overdrafts. A high-yield savings account can help you grow your money while also keeping it accessible.

Steps to Help You Better Manage Your Debit Card

If the convenience of using a debit card has made it your go-to tool for accessing cash and making purchases throughout the day, there are steps you can take to prevent overdrafts.

Monitor Your Accounts

Using a tracking tool to monitor your checking account and other account balances, can help you avoid an overdraft.

Set Up Low Balance and Other Alerts

If your bank offers account alerts, consider setting up a notification so you know when your checking account balance is getting low.

Know When Your Bills Are Due

Putting together a budget can help you pay your bills on time and organize your payment dates. Then, you might also see if you can move some payment dates. For instance, you could ask your credit card issuer to shift your date. That way, your checking account won’t be drained due to having so many payments in the same pay week or pay period.

The Takeaway

You may be able to overdraft your debit card transactions if you have overdraft coverage. This means your bank will cover the transaction, but you will likely be charged a fee for this privilege. If you choose not to opt into your bank’s standard overdraft coverage, there’s a good chance that a debit card transaction that would take your account into a negative balance would be denied.

The rules and fees for overdrawing your account with a check, automatic payment, or debit card can vary significantly depending on where you bank, so it’s a good idea to read all the paperwork you receive when you sign up for an account.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

What happens if I overdraw with my debit card without overdraft coverage?

Here’s what happens if you overdraft with a debit card: If you don’t have overdraft coverage and you don’t have enough money in your bank account to cover the transaction you’re trying to make, your bank will likely decline the purchase or withdrawal. You won’t overdraft your account and you won’t have to worry about paying an overdraft fee, but you will have to find another way to finance your transaction or skip it.

How much does overdraft coverage typically cost?

Overdraft fees can vary depending on the bank and other factors, including whether you have a backup account or credit card linked to your checking account. One recent survey found an average fee of around $26 or $27. That said, there is a movement afoot to lower these fees considerably which may or may not impact future charges.

Can I overdraft using my debit card at an ATM?

If you’ve opted in to your bank’s overdraft coverage, your ATM withdrawal may go through, even if you withdraw more than you actually have in your account. You can expect to be charged an overdraft fee for this service. If you don’t opt in to overdraft coverage, the transaction will likely be declined, and you won’t be charged an overdraft fee, but you won’t be able to access the funds you’re seeking.

Photo credit: iStock/megaflopp

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Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

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Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOBNK-Q324-080

Veterans have access to various scholarship and grant opportunities that can lessen the financial burden of pursuing ongoing education. These unique financial aid programs are sometimes also available to military families, which may include dependents or spouses of veterans.

If you’re a veteran who’s enrolling in college or have a dependent in your family who’s collegebound, we’ve created this guide to scholarships and grants for veterans to get you started.

Best Scholarships for Military Veterans

There are many scholarship programs available for military veterans and their dependents, all of which have different eligibility and application requirements. Below are just a handful of scholarships for veterans, or their dependents or spouses, that offer awards that are $2,000 or higher.

•   Pat Tillman Foundation Scholarship: The Pat Tillman Foundation Scholarship is a merit-based scholarship program that’s available to active duty and veteran military service members, including their current or surviving spouses. The average recipient receives approximately $10,000 per academic year and awards are renewable as long as you maintain eligibility requirements.

•   Folds of Honor Scholarship: The Folds of Honor Scholarship is available to dependents and spouses of a qualifying service member. Dependents must be enrolled in an accredited institution, a certificate- or license-granting technical, or a trade school program. The scholarship offers $5,000 per academic year, which is disbursed in amounts up to $2,500 per term. Awards are renewable, but recipients must reapply for each academic year.

•   AMVETS Scholarships: AMVETS Scholarships are a need-based program that’s open to veterans, active duty, and National Guard and Reserve service members and their families. The maximum award is $12,000. Applicants must be studying toward an undergraduate degree and meet other eligibility requirements.

•   Military Order of the Purple Heart Scholarship: Recipients of a Purple Heart who are members of the organization and their families — including spouses, children, grandchildren, and great-grandchildren — can apply for this scholarship program. Scholarship amounts vary each year and are based on available funding.

Another scholarship option is SoFi’s scholarship sweepstakes. It offers one $2,500 scholarship award per month over a 12-month period. Entry is available to SoFi members who are at least 17 years old and enrolled in an accredited, nonprofit, Title IV four-year college or university in the U.S. You can enter once per monthly scholarship period. Awards are sent directly to the winner’s school and can be used toward your cost of attendance.

Grants for Veterans

Grants are another type of college financial aid which doesn’t need to be repaid. Some grants require applicants to meet specific eligibility criteria. If your military family fits the program’s application requirements, a grant award can help make college costs more accessible.

Below are two grants veterans or their family members may qualify for.

The Iraq and Afghanistan Service Grant

The Iraq and Afghanistan Service Grant is a federal grant that’s offered by the U.S. Department of Education. It’s uniquely available to students whose parent or guardian died in active duty while serving in Iraq or Afghanistan, post-9/11. The available award is equal to the maximum Federal Pell Grant during the award year; in 2024-25 the amount is $7,395.

To qualify, veteran dependents must meet the Federal Pell Grant eligibility requirements but must not have received a Federal Pell Grant award in the same year. Additionally, recipients must have been under 24 years old or at least a part-time college student at the time of their parent or guardian death.

General Henry H. Arnold Education Grant

The General Henry H. Arnold Education Grant is provided by the Air Force Aid Society (AFAS). Children under 24 years old who are dependents of qualifying U.S. Air Force or U.S. Space Force members, as well as legally married spouses of Air Force or Space Force service members, can apply. Award amounts vary based on the recipient’s financial need.

Applicants must have graduated high school and be enrolled in an undergraduate program at an accredited school that participates in federal aid programs. You must maintain a cumulative minimum GPA of 2.0 and not be a graduate or professional student, veteran, or military branch member, including the National guard or Reserves.

Veterans Affairs Educational Benefits

Veterans have earned a slew of education benefits that can help them — and under some programs, their families — financially pursue higher education or career training. The list of programs you might have access to through Veterans Affairs (VA) include:

•   Montgomery GI Bill for Active Duty

•   Montgomery GI Bill for Selected Reserve

•   Post-9/11 GI Bill

•   Reserve Educational Assistance Program

•   Post-Vietnam era Education Assistance Program

•   National Call to Service

•   Survivors’ and Dependents’ Educational Assistance

Depending on your service background, you might be eligible for multiple VA education benefit programs. Additionally, you can receive financial support to help pay for books and supplies, test fees for licenses or certifications, national exam fees, and more.

Recommended: What Are Student Loans for Military Dependents?

Grants for Active Duty Servicemembers

Financial aid grants aren’t just for veterans and their families. Service members can also apply for grant programs while in active duty.

One option to explore is the Federal Pell Grant, which is available to undergraduate students who demonstrate exceptional financial need and are enrolled in a U.S. school. As a federal financial aid program, applying for a Pell Grant only takes submitting a Free Application for Federal Student Aid (FAFSA). If you qualify, the maximum Pell Grant award for the 2024-25 academic year is $7,395, though this award might vary year over year.

Recommended: How to Complete the FAFSA Step by Step

Can I Get a Scholarship if My Grandfather Was in the Military?

GI Bill benefits are reserved for the service member’s education or that of their spouse or children. However, grandchildren of military service members also have access to some scholarships for veterans.

For example, the AMVETS Scholarship is also available to grandchildren of veterans and active duty U.S. military members. Grandchildren of active duty National Guard or Reserves members are also eligible.

What Qualifies You as a Veteran for FAFSA?

Unlike the criteria for veteran status under the VA, the FAFSA defines veterans as a service member who served in active duty for a minimum of one day and was released.

The condition for release must not be dishonorable discharge. Time spent by service members in basic training — except those in the National Guard and Reservists — also qualifies as active duty under the FAFSA.

The Takeaway

Utilizing your VA education benefits, including all eligible GI Bill benefits, is the first step you can take to help pay for college costs. Applying for scholarships for veterans, or for dependents or spouses of veterans, can make higher education or career training accessible for you and your family.

In addition to military scholarships, you can apply for traditional scholarships and grants to help pay for college. You can also apply for federal student loans and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

Does the VA offer college scholarships?

Yes, the VA offers college scholarships through programs like the Post-9/11 GI Bill and Survivors’ and Dependents’ Educational Assistance (DEA). These scholarships help cover tuition and education costs for veterans, active duty service members, and their dependents, providing financial support for higher education and career advancement opportunities.

Can veterans apply for FAFSA?

Yes, veterans can apply for the FAFSA. In fact, some grants and scholarships for veterans require a submitted FAFSA for the award year as part of their application requirements.

What is it called when the VA pays for college?

The VA benefit that pays for service members’ college and training expenses is called the GI Bill. The Department of Veteran Affairs website offers a helpful GI Bill Comparison Tool that lets you see and compare GI Benefits across approved institutions.

Photo credit: iStock/SDI Productions

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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SOISL-Q324-094

STEM stands for science, technology, engineering, and mathematics, and it’s a popular area of study for its higher-paying occupations and expected job growth. According to the U.S. Bureau of Labor Statistics, careers in STEM earn more than double the national average and are expected to grow more than 10% by 2033.

There are numerous scholarships exclusively available to students pursuing a degree in a STEM field. Below, we’ve outlined a list of STEM scholarships, plus common eligibility requirements and tips for applying.

STEM Scholarships for Graduate Students

Students in a master’s or doctoral program can apply for specific STEM scholarships to help cover tuition and living expenses. Scholarship eligibility may be based on the program type and focus of a student’s research.

Below are five STEM scholarships for graduate students.

•   American Nuclear Society Scholarship Program: Multiple awards ranging from $1,000 to $5,000 for graduate and undergraduate students enrolled in a degree program related to nuclear science or nuclear engineering.

•   American Welding Society Research Fellowships: Funding and support up to $35,000 annually for graduate students who are engaged in cutting-edge research within the field of welding.

•   Charles LeGeyt Fortescue Scholarship: Funding for one year of full-time graduate studies (up to $24,000) in electrical engineering at an accredited engineering school in the U.S.

•   DOE Computational Science Graduate Fellowship: Tuition assistance, stipend, and professional development ($45,000 value) for incoming and first-year PhD students enrolled in engineering, physical, computer, mathematical, or life sciences programs.

•   Dr. Nancy Foster Scholarship Program: Financial support of up to $47,000 for master’s and doctoral students in oceanography, marine biology, engineering, and resource management disciplines conducting research related to the mission of the National Oceanic and Atmospheric Administration.

For a chance to win SoFi’s monthly $2,500 Scholarship Sweepstakes, simply let us know your name, email address, and school.

STEM Scholarships for Undergraduates

There are many STEM scholarships available to undergraduate students. Eligibility requirements may include a student’s major, location, financial need, academic achievement, and class standing.

Below are five STEM scholarships for undergraduate students.

•   Changing the World Scholarship: Offers $1,000 awards per semester for undergraduate students who are pursuing a STEM degree and have a GPA of 3.0 or higher and demonstrated financial need.

•   Cold War Veterans Scholarship: Three $2,500 scholarships for students who are an active member of the Marine’s Memorial or a child or grandchild of an active member to pursue undergraduate studies in a STEM field.

•   Goodyear STEM Career Day Scholarships: Multiple awards ranging from $1,000 to $2,500 for Ohio high school graduates pursuing a bachelor’s degree in engineering or a STEM discipline.

•   Lockheed Martin STEM Scholarship: Multiple scholarships for undergraduate students enrolled in a four-year degree program and majoring in engineering, computer science, mathematics, or physics.

•   SAE/Ford Partnership for Advanced Studies Scholarship: One $5,000 scholarship for an incoming freshman pursuing an engineering or related science degree at an accredited U.S. college or university.

Recommended: Grants, Scholarships, Loans: The Differences

How to Apply for a STEM Scholarship

To apply for a STEM scholarship, you first need to put in the time to research and find STEM scholarships you qualify for. During your search, keep track of submission deadlines and application requirements for any opportunities you plan on applying to, as these can vary between scholarships.

A personal statement or essay is a common requirement for STEM scholarships. While it’s best practice to tailor your writing to address the scholarship’s specific prompts and instructions, creating a generic personal statement that you can modify for each application can save time.

STEM scholarships often require school transcripts and a letter of recommendation or references. Think about which high school teachers, college professors, or employers are best suited to speak to your academic merit and personal character. When applying for a STEM-specific scholarship, using a reference who teaches or works in a STEM field could be advantageous.

Recommended: How to Pay for College

When Should I Apply for STEM Scholarships?

There are STEM scholarships and grants available to help pay for all levels of higher education, from freshman year of undergrad to completing a master’s or doctoral degree.

For high school seniors, it’s okay if you’re not sure what college you should go to yet to begin applying for college scholarships. Some scholarship deadlines are one year in advance, so it’s helpful to be planning well ahead for applications.

Current college and graduate students can continue applying for scholarships every year of their education, and it may be necessary to reapply for an award if it doesn’t renew annually.

What Kind of GPA Do I Need to Apply for a STEM Scholarship?

STEM scholarships have different eligibility criteria, including GPA requirements. However, many merit-based scholarships require a GPA of at least 3.0 to apply, whereas students could qualify for some need-based awards with a GPA below a 3.0.

Recommended: Tips for Getting Straight A’s in College

Are International Students Eligible for STEM Scholarships?

Many STEM scholarships are intended for students who are U.S. residents. But there are still opportunities for international students to consider, including university-specific scholarships and grants.

Recommended: Can International Students Get Student Loans to Study in the U.S.?

Top 5 STEM Scholarships for Women

There are many scholarships specifically for women pursuing a STEM degree and career. STEM scholarships for women are offered by companies, professional associations, and nonprofit organizations.

The top five STEM scholarships for women include:

•   Advancing Women in Science Scholarships: Various awards for undergraduate and graduate students who are pursuing degrees in STEM fields and members of the Association of Women in Science.

•   Elevate Women in Technology Scholarship: One $1,040 STEM scholarship for a woman who intends to enter a career that leverages technology to make the world a better place, with preference for a student involved in a STEM field and entrepreneurial endeavors.

•   SAE Women-in-Automotive Scholarship: Thirteen $5,000 scholarships for women with strong academic achievement and who are enrolled in an engineering degree program to pursue a career in the automotive industry.

•   Scholarships for Future Women Engineers: Multiple awards ranging from $2,500 to $20,000 for women pursuing an associates or bachelor’s degree in STEM, manufacturing, or industrial engineering.

•   STEMinist Scholarship: Financial support of up to $5,000 for women of color from the Chicago metropolitan area pursuing a college degree in engineering or a STEM-related field.

Recommended: 10 Popular Scholarships for Women

Full Eligibility Requirements

When browsing STEM scholarships, it’s important to verify that you meet eligibility requirements before spending time and effort applying. There may be minimum GPA and residency requirements for applicants.

Depending on the type of scholarship, students could be required to demonstrate leadership experience, involvement in community service, and other experiences or skills to qualify.

Completing the FAFSA can be a prerequisite to apply and be considered for both need-based awards and merit scholarships.

Recommended: How to Complete the FAFSA Step by Step

The Takeaway

Earning a degree in a STEM field can put you on the path to a rewarding and high-paying career. There are many scholarships for undergraduate and graduate students interested in a variety of STEM-related disciplines. Students can apply every year of school to increase their chances of getting scholarships and grants for college.

Still, many students require additional financing, such as federal and private student loans, to fund their education.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

What does STEM scholarship stand for?

A STEM scholarship is a type of free financial aid for students studying science, technology, engineering, or mathematics — a collection of subject areas known as STEM.

What is a STEM scholar?

A STEM scholar is someone who studies an academic discipline related to either science, technology, engineering, or math.

How can I apply for STEM scholarships?

To apply for STEM scholarships, students usually need to complete an online application, provide academic transcripts, and sometimes submit essays or letters of recommendation detailing their interest in a STEM field.

Photo credit: iStock/gorodenkoff

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOISL-Q324-085

Abbreviations on bank statements typically help identify different types of transactions and share information about your balance. While much of the information on your bank statement is straightforward, occasionally your bank statement may contain abbreviations that you don’t understand.

There are a few common bank statement abbreviations that are good to know, since understanding all of the information on your bank statement may help you to make better financial decisions. The good news is that most of the most common bank statement abbreviations are fairly easy to understand. Once you know what each one stands for, it can help you get a better picture of the overall health of your bank account.

Understanding Common Bank Statement Abbreviations

If you have a checking or savings account, your bank almost certainly sends you a bank statement on a regular basis. This usually happens monthly, and you may receive your bank statement electronically or via a printed statement in the mail. Whether you keep your bank statements or not, it can be wise to review them carefully. Doing so can help you spot any errors or fraudulent charges and scan for bank fees.

As you review your bank statements, you may encounter abbreviations. Some of these may be familiar, but others may require clarification.

Why Banks Use an Abbreviation

There are a few reasons why banks might use an abbreviation for some items:

•  Technological requirement: Many banks rely on underlying financial systems that code certain types of information with abbreviations. These systems require shortened information for proper processing.

•  Saving space: Banks may need to display a lot of information in a relatively small space, and abbreviations can help with this.

•  Security and privacy: Sometimes, using an abbreviation can help conceal sensitive information that banks don’t want to state explicitly on a bank statement.

•  Standardization: Abbreviations can allow banks to use the commonly recognized terms for certain products and services in their records and communications. This uniformity can make organization and recognition easier for all parties involved in banking.

For these reasons, you may see shorter forms of banking terms as you conduct your personal finance business.

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List of Common Abbreviations in Bank Statements

Here are a few of the most common abbreviations you might find in bank statements relating to your checking account or other holdings:

ACH

An ACH payment is one that is processed through the Automated Clearing House. ACH transactions are usually transactions where money is sent to or received from another bank account via electronic networks.

ATM

ATM stands for automated teller machine, and it might signify a withdrawal of cash from or a deposit to your account at one of these devices.

CHK

CHK signifies a check transaction. When you write a check, you may see this abbreviation on your bank statement when the check is deposited and/or clears. Occasionally, this may be abbreviated as CHQ for financial institutions that prefer the spelling of “cheque” to “check.”

CR

CR — or sometimes CRE or CRED — is an abbreviation for a credit, which is usually an amount of money that is credited to your account at a traditional or online bank. This could reflect a direct deposit from a salary, a merchant refund, or any other form of account credit.

DR

DR indicates a debit to your account, such as when money is withdrawn, either from an electronic transfer, a debit card transaction, or a bill payment.

EFT

Similar to ACH transactions, EFT transactions are electronic fund transfers that usually come from another bank account.

However, take note not to confuse it with an ETF, which stands for exchange-traded fund, a type of pooled investment.

FEE

FEE is not actually an abbreviation at all, as this bank statement code just means a fee assessed to your account. This could be any number of bank fees, including maintenance fees, account fees, or non-sufficient funds fees.

INT

This bank statement abbreviation stands for interest that is credited to your account. Many checking or savings accounts pay interest to the account holder based on the total amount on deposit. When that interest is paid, it could be referenced on the bank statement with this abbreviation.

OD

OD typically stands for overdraft and means that your balance has dipped into negative territory. You might also see your balance expressed with a minus sign when you have overdrawn your account. In most cases, this means your account is accruing overdraft fees, so it’s wise to get your account back to positive as soon as you can.

POS

POS stands for point of sale, and usually represents a purchase made with a debit card or credit card at a physical retailer. Confused by the phrase “point of sale terminal”? Think of it as the common term “cash register” in daily conversation.

TFR

TFR stands for transfer. When money moves between your bank accounts, you may see these three letters indicating that money has been transferred.

TLR

TLR indicates that a transaction was conducted with a bank teller at a branch. Those who have accounts at traditional vs. online banks are more likely to see this code.

Importance of Knowing Bank Statement Abbreviations

While some bank statement abbreviations may seem obvious and others obscure, it can be important to understand these terms. They help you keep tabs on the money in your bank account and your financial progress.

It can be a good idea to regularly review your bank statements as they are received. That way, you can check for unexpected or possibly fraudulent transactions. Ideally, you should be able to recognize the transactions on your statement as ones that you initiated and/or authorized. If you see a transaction on your statement that you don’t recognize, you should contact your bank’s customer service department; you may be referred to their fraud protection team if necessary. This may help protect against having your account compromised by bank fraud and from risking identity theft.

Recommended: How to Write a Check

The Takeaway

Financial institutions regularly send bank account statements to their customers, usually on a monthly basis. These statements typically communicate a large amount of information, and they may include abbreviations that shorten and standardize details. By understanding these abbreviations (such as ACH, ETF, and OD), you can enjoy deeper knowledge of your account information and keep tabs on your money.

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FAQ

How can you identify an unknown retailer abbreviation on your statement?

While many transactions on your bank statement include the name or other identifying information of the merchant in question, some transactions may not be identifiable. One way to identify an unknown retailer is by doing an Internet search for the information that appears on your statement. Another may be to look for the same transaction on past statements of yours. Or contact your bank’s customer service department to see if they can help you with more information about the merchant.

What is included in a bank statement entry?

A bank statement usually includes a list of transactions made during the statement period. Each of these transactions is sometimes called a bank statement entry. A bank statement entry can contain the date of the transaction, the type of transaction, the amount involved, and a brief description of the retailer, merchant, or other party to the transaction, among other details.

Can your bank help decode bank statement transaction abbreviations?

Many bank statement abbreviations are straightforward, but there are some that may not be easy to decipher. If you’re unable to understand what a bank statement abbreviation means by reviewing your statement or doing an Internet search, you may want to talk to your bank’s customer service department. They can likely help you decode the information on your statement.

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As ESG-focused strategies continue to attract investors, there is a growing interest in establishing frameworks that can help companies meet specific environmental, social, and governance criteria — the better to help investors evaluate company performance in light of ESG standards.

ESG frameworks are important because they can allow market participants to reference a common set of guidelines when evaluating companies for investment purposes. In theory, consistent ESG frameworks could help encourage more efficient and transparent markets.

Although there are a number of ESG frameworks in use, however, the ESG sector as a whole still lacks a set of clear-cut criteria that have found universal approval or acceptance. Most recently, the Securities and Exchange Commission (SEC) put its own new set of ESG disclosure rules on hold.

What Is an ESG Framework?

ESG frameworks include principles, guidelines, and often metrics to help firms measure and, importantly, report their progress regarding specific environmental, social, and governance standards — which in turn helps investors interested in green investing.

•   Environmental factors may include carbon emissions, sustainable energy use, pollution regulation, climate impact, and more.

•   Social factors may include a company’s involvement and support of local community issues, worker safety, as well as diversity, equity and inclusion in the workforce.

•   Governance factors may include a company’s leadership selection process, accounting practices, data privacy, and transparency in reporting.

As such, ESG frameworks are an attempt to standardize both methodologies and metrics employed in ESG disclosures to better serve all stakeholders.

The State of ESG Frameworks

Although there are numerous organizations (including policy groups and regulatory agencies) that have developed frameworks for ESG reporting in recent years, there has yet to be a single set of standards to insure that companies are held accountable for managing certain risk factors, and that investors are afforded some reliability in terms of their ESG investment choices.

While the SEC approved a set of ESG disclosure rules in March 2024, a month later, owing to legal challenges, these rules were put on hold.

In short: With no official ESG standards required by U.S. financial regulators or other governmental bodies, the question of which framework to adopt is left up to the individual firm.

Likewise, the lack of agreed-upon ESG frameworks means that investors must shoulder the responsibility for understanding which standards and/or metrics a company may be following, and whether this meets their own standards for investment.

Recommended: Sustainable Investing Guide for Beginners

What Is the Goal of an ESG Framework?

ESG frameworks give companies a way to define key principles, standards, and goals in each area (i.e., pertaining to the environment, societal factors, and corporate governance) in order to facilitate accurate ESG reporting. These frameworks may include metrics to measure progress toward specific goals.

Thus, ESG frameworks serve three main purposes:

1.    To provide guidelines for companies in terms of their operations and outcomes.

2.    To enable consistent reporting that enables investors to evaluate companies.

3.    To help governments track regulatory compliance, and identify areas for improvement or disciplinary action.

ESG Frameworks and Risk

In addition to helping support positive ESG outcomes, companies that adhere to an ESG framework may also be able to mitigate certain ESG risk factors that can impact company performance long term.

For example: Reducing the demand for fossil fuels as part of product manufacturing can be beneficial for the environment, and it also may help protect a company from price shocks from oil or gas shortages — which can help its bottom line.

Recommended: What Is Socially Responsible Investing?

Benefits of Using an ESG Framework

To the extent that an ESG reporting framework can act as a blueprint for progress in specific areas, it may be more likely that organizations that embrace a certain framework are able to drive more positive outcomes in desired areas.

In that light, an ESG framework can enable companies to expand the scope of their business reporting to a wider universe of stakeholders.

•   From an environmental perspective, using ESG to guide corporate actions can mitigate the chance of government oversight; and it may reduce a firm’s overreliance on natural resources, and help to limit insurance and legal costs if environmental safety guidelines are followed.

•   From a social perspective, ESG-influenced policies can improve working conditions, employee retention, reduce the likelihood of labor disputes that can impact productivity, build community support, and improve a firm’s image.

•   When it comes to governance, ESG policies can improve transparency at all levels of a firm; protect data privacy; reduce fraud; and potentially reduce operational costs through the better alignment of all stakeholders within a firm.

Large financial institutions, such as public pension funds, have started incorporating ESG criteria into their investment selections. In addition, there are now ESG-focused ETFs and mutual funds being offered by mutual fund companies, online investing platforms, and brokerage firms.

Types and Examples of ESG Frameworks

In the last 20 years or so, over a dozen ESG frameworks have been established. And while some methods may overlap with each other, and in the last few years some have been consolidated, the existing frameworks each provide a separate set of standards, metrics, and reporting requirements that organizations can consider.

Despite the confusing number of options, some frameworks or disclosure systems seem to be taking the lead in terms of wider adoption, particularly with the expansion of the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards.

While some firms have adopted all or parts of these frameworks, others have created proprietary sets of criteria, metrics, and reporting methods that, in some cases, may complement existing frameworks.

Following is a brief summary of some prominent ESG frameworks:

Global Reporting Initiative (GRI)

The Global Reporting Initiative, established in 1999, is an independent organization that helps companies and governments assess and report their impact on ESG issues such as climate change, human rights, and corruption. Although the GRI standards are voluntary, nearly 80% of the world’s biggest companies by revenue have adopted the GRI reporting standards, making it the most widely adopted framework.

International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards

The IFRS establishes corporate accounting standards and policies overseas; it’s the equivalent of the U.S. Generally Accepted Accounting Principles (US GAAP). Because a growing number of companies need a way to incorporate sustainability into their accounting and reporting disclosures, the IFRS Foundation set up the International Sustainability Standards Board (ISSB) in 2021.

The ISSB disclosure standards are voluntary, and build on previous frameworks, a few of which have since been folded into the working IFRS Sustainability Disclosure Standards, including: the Task Force on Climate-Related Financial Disclosures (TCFD), Climate Disclosure Standards Board (CDSB) and others.

Sustainability Accounting Standards Board (SASB) Standards

The SASB Standards were established in 2018 to enable the disclosure of sustainability-related information that would be considered financially material; the framework detailed key ESG issues across 77 different industries. These standards were absorbed by the IFRS Foundation in 2022, and as such are now overseen by the ISSB, which maintains the SASB Standards for organizations that prefer this method.

CDP

The CDP (formerly the Carbon Disclosure Project) is an international non-profit that helps not only companies, but state and local governments to evaluate and disclose key environmental impacts such as carbon and greenhouse gas emissions, water quality protection, and deforestation on a voluntary basis.

Companies are given a score on separate areas; the questionnaires have been modified to align with the IFRS climate disclosure requirements (above), and continue to evolve. According to CDP, over 23,000 companies around the world rely on the CDP disclosure framework.

United Nations Global Compact

The U.N. Global Compact is considered one of the world’s largest corporate sustainability initiatives; it is “principle based” in that this U.N. pact is non-binding and offers 10 voluntary principles that organizations can use to establish or enhance policies based on human rights, labor practices, the environment, and anti-corruption measures. These 10 Principles are aligned with the 17 Sustainable Development Goals (SDGs), which continue to serve as global guidelines and voluntary frameworks for greater corporate accountability.

The Takeaway

For investors who are exploring ways to invest sustainably, or invest in companies committed to ESG goals, it can be helpful to understand the landscape of ESG standards and reporting frameworks. While there are a number of existing ESG frameworks, a handful have been more widely adopted, which can be useful for ESG-focused investors to know.

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