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By James Darden II<\/a>, Vice President of Operations & Client Services<\/p>\n
Leadership provided by outside credit union board members is critical in setting strategic direction and ensuring that established policies, compliance expectations, and state and federal laws and regulations are followed. In addition, board member support for the services you offer make them important ambassadors in the community and can have a major impact on your credit union\u2019s long-term success.<\/p>\n
On-going scrutiny of overdraft programs that utilize undisclosed procedures and high fees\u2014as discussed in recent Congressional and Senate subcommittee hearings\u2014can erode board confidence in your overdraft strategy. Plus, recent efforts by big banks to distance themselves from the criticism by eliminating overdraft coverage, can create a sense of urgency to follow the pack to make changes without considering the consequences. Left unchecked, these situations can lead to haphazard program adjustments that may hinder your overall ability to provide better service and value for members.<\/p>\n
That\u2019s why, when you offer a consumer-focused overdraft strategy, it is vital to educate your board and internal teams about how it reinforces your service philosophy. This also reinforces the value a fully disclosed, consumer-centric program provides as an option for members who may need it from time to time.<\/p>\n
Effective board discussions should focus on the key issues that distinguish your service from the \u201cbad actors\u201d that are in the news. When everyone is on the same page, your team will be in a much better position to critically evaluate and reinforce the benefits your program provides to members. For instance:<\/p>\n Seeing the headlines about banks and credit unions making the move to eliminate or lower their overdraft fees should not be a cause for concern. First, the institutions making the changes can more easily absorb the loss in fees. Plus, it\u2019s likely they will find ways to recoup the revenue, one way or another.<\/p>\n Second, it\u2019s important to consider that these changes represent more of a marketing tactic than anything else. Look at the fine print for institutions that have \u201creduced\u201d or \u201celiminated\u201d overdraft fees. In many instances, there are still transfer fees, minimum balance requirements, minimum deposit requirements and other confusing eligibility requirements associated with how negative-balance transactions will be handled. Worst of all, without access to overdraft protection services, an important transaction could be denied.<\/p>\n Make sure board members and internal teams understand that overdraft protection is a service that consumers want, need and appreciate. This was confirmed by Morning Consult\u2019s study<\/em><\/a>\u00a0 for the American Bankers Association that found:<\/p>\n These figures reinforce the value that most consumers place on overdraft programs to avoid less desirable means of securing funds, such as:<\/p>\n A fully disclosed overdraft service with reasonable fees is not the deceptive, predatory product that some have portrayed it to be. Those institutions that have implemented significant changes to their program have done so because they:<\/p>\n The best way to instill confidence in your overdraft program is to make it so beyond scrutiny that no consumer, regulator, lawyer or competitor can find fault.<\/p>\n \u00a0<\/strong>In some cases, changes may be necessary to provide a responsible and transparent service. Active discussions on why changes are being made, what value is being added for members or what efficiencies might be created for better program management support the idea of taking a holistic approach to this important service option. Your leadership team will appreciate it too.<\/p>\n An expert in overdraft program management and compliance can provide the advice and guidance your institution\u2019s leadership and board need to take the worry out of maintaining an ethically sound overdraft program.<\/p>\n They can also keep everyone up-to-date when it comes to regulatory changes, best practices and industry trends, so you\u2019re aware of how your program is affected, and what, if anything, should be adjusted. Most importantly, fully informed board members will have the knowledge and confidence to advocate that your program is serving the needs of your members and your community.<\/p>\n <\/p>\n About JMFA \u00a0<\/em><\/strong><\/p>\n \u00a0<\/em><\/strong><\/p>\n <\/p>\n <\/p>\n <\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][\/et_pb_section]<\/p>\n ","protected":false},"excerpt":{"rendered":" [et_pb_section fb_built=”1″ _builder_version=”4.9.4″ _module_preset=”default” custom_padding=”0px|||||”][et_pb_row _builder_version=”4.9.4″ _module_preset=”default” custom_padding=”0px|||||”][et_pb_column type=”4_4″ _builder_version=”4.9.4″ _module_preset=”default”][et_pb_text _builder_version=”4.9.4″ _module_preset=”default” hover_enabled=”0″ sticky_enabled=”0″] Strengthen understanding of overdraft program benefits to fend off uncertaintyBy James Darden II, Vice President of Operations & Client Services Leadership provided by outside credit union board members is critical in setting strategic direction and ensuring that established policies, compliance […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=\/wp\/v2\/posts\/4242"}],"collection":[{"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4242"}],"version-history":[{"count":0,"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=\/wp\/v2\/posts\/4242\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4242"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4242"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ncultheaffiliate.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4242"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
Focus on what differentiates your program<\/strong><\/p>\n\n
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Stay focused on your mission<\/strong><\/p>\n
No overdraft program, what then? <\/strong><\/p>\n\n
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Replace the rhetoric with confidence <\/strong><\/p>\n\n
When in doubt, seek professional advice<\/strong><\/p>\n
<\/strong>JMFA<\/a>\u00a0is one of the most trusted names in the industry. Whether it\u2019s recovering lost revenue, uncovering new savings with vendor contract negotiations, creating more value, serving members better or delivering a 100% compliant overdraft service\u2014JMFA can help you deliver measurable results with proven solutions. To learn more please contact Derrik Mather<\/a> orcall (800) 809-2307.<\/p>\n![\"\"](\"http:\/\/www.ncultheaffiliate.com\/wp-content\/uploads\/2014\/05\/JMFA_logo-PMS_3155R.jpg\"){kind=logo}
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