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A Spring-Cleaning Checklist for Your Overdraft Program

A Spring-Cleaning Checklist for Your Overdraft Program

By Mark Roe, Executive Vice President of National Sales

Spring is here, and with the coronavirus pandemic in full force, this season will present many serious challenges that we never could have expected. In an effort to continue serving your account holders’ best interests, especially in financial emergencies, this season also presents a chance to step back and take stock of your overdraft program. Is it functioning as it should? Use this checklist to guide you toward improvements.

  • Get to know your account holders.
    Your overdraft program should exist to provide a valuable service and act as a safety net to account holders in times like these. This pandemic will hopefully pass sooner rather than later, but how you support account holders now can define your future relationship with them.


Today’s users of overdraft services could be the same people who hold auto loans, mortgages and retirement accounts with your institution. If they don’t utilize additional services with you today, they may down the road. Retaining and growing their business could depend a lot on how you treat them now. By getting to know their current situation and goals, you can offer better financial advisory services to help them reach those goals with your bank or credit union while helping them keep their heads above water now.


  • Run the numbers.
    Successfully managed overdraft programs that provide full transparency to account holders should also allow you to track and measure results. Does your overdraft program have any red flags? Before the COVID-19 outbreak, were you returning more NSF or overdraft items than you’re paying, resulting in high losses? How has your program performed in years past? (If you don’t have the ability to run the numbers, that in itself is also a red flag.)

  • Survey your employees.
    The difference between a successful overdraft program and one that goes unused often boils down to your employees. They’re on the front lines providing information about this service to account holders, so find out if your employees experience any pain points while explaining the program, or what kind of feedback they’re getting. Maybe some employees do not feel comfortable discussing the service, or are confused about how it’s run, so they don’t voluntarily bring it up. This represents a missed service opportunity for an account holder who wants this peace of mind, especially today.

  • Focus on training and delivering a consistent message.
    Training is an essential aspect of a compliant and transparent overdraft service and can help your employees overcome obstacles in talking about it.


Account holders should receive the same information and the same answers whether they are visiting a branch location or learning about your program from your website. However, due to turnover or inconsistent training, this doesn’t always occur at all financial institutions. But it needs to. With some staff working remotely at this time, take advantage of online training opportunities so they can be current on the best ways to communicate with account holders about your program.


  • Mitigate your legal risk.
    A well-managed, constantly monitored overdraft program shouldn’t leave you with any compliance concerns. In light of recent litigation on a variety of issues, make sure to review your program disclosures. To
    ward off risk of overdraft/NSF fee demand letters, you can take precautions such as maintaining awareness of the issues attracting legal interest and committing to full disclosure and error resolution.


  • Contact an expert.
    A third-party consultant with expertise in managing a fully transparent overdraft service can provide an
    overdraft program analysis to give you an idea of the compliance certainty and the non-interest income you could be achieving while continuing to support your account holders. Best of all, they take care of these “spring cleaning” duties all year long, so you can focus your time and energy on other projects and initiatives at your bank or credit union like delivering the very best experience for account holders.


JMFA is one of the most trusted names in the industry. Whether it’s recovering lost revenue, uncovering new savings with vendor contract negotiations, creating more value, serving account holders better or delivering a 100% compliant overdraft service—JMFA can help you deliver measurable results with proven solutions. To learn more, please contact your local representative or call us at (800) 809-2307.



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