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When It Comes to Overdraft Solutions, Full Disclosure is Preferred Regulatory Strategy
Thursday, August 11, 2016 6:40 AM

By Cheryl Lawson, Executive Vice President-Compliance Review, JMFA

Despite the fact that regulators continue to delay a ruling on overdraft services, consumers continue to need help with managing their finances from time to time, and financial institutions are struggling to find reliable sources of revenue.

Under these circumstances, it is more important than ever to provide members with a reasonably priced, easily understood, and non-discriminatory solution that helps them to maintain their financial well-being. When this solution also provides the credit union with a reliable revenue stream and regulatory peace of mind, everybody wins.

Over the past 10 years there have been several regulations or proposed guidance on overdraft solutions, but there has been no firm directive from regulatory bodies that disallows courtesy pay or overdraft programs. So the issue for credit unions becomes how to implement an effective solution that is sensitive to regulatory comment or perspective; satisfies the needs of members who may experience a temporary financial shortfall; and helps the institution achieve its revenue goals.

Regulatory compliance is essential for a value-added overdraft solution
Simply stated, regulators expect financial institutions to be transparent. A fully-disclosed overdraft program clearly defines the rules by which an account holder may access the service. This straight-forward approach of responsible… READ MORE.

About John M. Floyd & Associates
JMFA is endorsed by Credit Union Resources, Inc., a wholly owned subsidiary of Cornerstone Credit Union League. JMFA is a leading provider of profitability and performance-improvement consulting. For more than 36 years, JMFA has been recognized as one of the most trusted names in the industry for earnings enhancement and expense control programs, training and development, and recruitment services, as well as product, service, pricing and technology-improvement consulting. Simply stated, JMFA’s programs and services are designed to increase income or reduce expenses. JMFA is proud to be a preferred provider among many industry groups. To learn more about JMFA, please visit or call 800-809-2307.