Configuring Cashed Check Fees

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UCCCFG-01

Check Cashing Fee Configuration

1714

Access this screen by selecting Tool #188: Cashed Check Fee Configuration (maintenance) or for view-only via the Fee Income/Waiver Analysis or via Tool: 424: Learn-From-Peer: Cashed Check Fee Config (inquiry)

Learn from a Peer

Use this link to find the topic to Learn more about Learn from a Peer Cash Check Fees

Interested in how your fee configuration compares with other credit union’s configurations? If this screen is accessed via Tool: 424: Learn-From-Peer: Cashed Check Fee Config or via the Fee Income/Waiver Dashboard, the Learn from a Peer Cashed Check Fee Configuration Comparison can be accessed from this screen accessed using Learn from a Peer (F10). SEE ALSO: Learn from a Peer – Cashed Check Fee Configuration

NOTE: This comparison will only allow you to compare your configuration with other credit unions on your system.

Introduction to Check Cash Fee Configuration

Determining a cost for cashing checks can involve many factors. For example, how much non-earning cash does the teller line need? What is the cost of presenting checks to the clearing house? What is the cost of the actual transaction? And, of course, what about the risk should the check be invalid?

When a member is an active participant in the credit union, these costs are easily justified and covered by the credit union's normal income spread. However, if members cash an inordinate number of checks, or have a minimum-balance account simply for the purpose of cashing checks, a credit union may wish to charge a fee for this expensive service. The CU*BASE Cashed Check Fee Configuration is used to design this fee structure.

If your credit union offers non-member teller services, you can set up a special check-cashing fee just for non-member activity.

Check Cashing vs. Check Negotiation

Normally we think of check cashing as when a member (or non-member) requests the entire amount of the check back in cash. However, some members have gotten wise to this and ask to deposit a dollar or two of the check just to avoid the fee.

Since the purpose of the fee is to help offset the costs associated with handling checks, some credit unions have broadened the scope of this fee to use it more as a “check negotiation” fee, charging the fee even if the member chooses to do something with the check other than receive it all in cash. This is controlled by the setting of the Charge fee if deposit or MR field on this screen. (See “Field Descriptions” below for details about how to set this flag.)

Methods for Calculating the Fee

There are two different methods available for calculating the fee. Waivers can be configured here (they apply to both methods), as well as through the Tiered Service Level Rewards system and Marketing Clubs Fee Waivers and Benefits.

Flat Fee - This option lets you specify a flat fee to be charged regardless of the amount of the checks being cashed. With this configuration, you may also specify the number of “free” items to be granted before the fee takes effect.
Percentage of Checks Cashed - With this option, the fee is calculated at the time of the transaction by adding the total amount of checks being cashed and multiplying by a percentage. Similar to the “quick cash” check-cashing centers which are becoming common in most cities, this method is particularly helpful in offsetting the costs associated with members that join the credit union specifically for the purpose of cashing checks.

The Cashed Check fee is an interactive fee, charged as a miscellaneous receipt through the teller auditing system. The fee configuration allows you to decide what miscellaneous receipt G/L code will be used to post the fee income. The system also configures fees based on the configuration and the number of outside checks in the Teller Funds In screen. These fees are charged immediately at the time of the transaction and the income is processed as a miscellaneous receipt.

This configuration screen is used to specify how members will be charged for checks cashed by a teller. When done filling in parameters, use Enter to save the changes.

NOTE: In this case, a cashed check refers to an outside check that is cashed at the teller line. Because of the difference in processing requirements, check cashing fees do not apply to checks entered as in-house drafts on the Teller Funds In screen.

CU*TIP: Want to know who is paying these fees? Use the Miscellaneous Receipt Analysis Report. Since this fee uses a CU-defined Misc. Receipt Code, you could also create a custom report or inquiry using the CU*BASE Report Builder. Simply Query file MSRCPT for transactions that use your designated M/R code as defined on this screen. (This data could also be cross-referenced against your MASTER file if member names and addresses are needed.)

Field Descriptions

Field Name	Description
Activate check cashing fee	This flag MUST be set to Yes in order for check cashing fees to be assessed through the Teller Posting system.
Receipt/inquiry description	This description will appear on member inquiry screens and statements for any transactions incurring this fee.
Member Cashed Checks This fields in this section control fees for credit union members who cash checks at the teller line. (This is also the fee that will be charged to members of other credit unions who are cashing checks at your credit union through *CUBASE Shared Branching.**)
Flat Fee Use the flat fee option to charge the same fee to every member, regardless of the amount of checks being cashed. This method lets you grant a certain number of “free” items that a member can cash during a transaction without incurring a fee.
Fee amount	The total amount of the fee.
Per item/transaction	Used to indicate whether the fee is charged per item cashed, or once per transaction, regardless of the number of items. For example, if a member brings in 34 checks to be cashed at the same time, is he charged the fee 34 times for each item, or just once for the entire transaction? This field works together with the Number of Free Items field. If per item, then that number of free items are allowed before the fee is assessed; if per transaction, then that number of transactions are granted free.
Number of free items	This field indicates how many cashed checks can be processed without incurring any fees. For example, if you are charging members a fee for each cashed item, you may choose to provide 10 free items before the charge kicks in. Therefore, a member cashing 15 items would only be charged for 5 items. This field works together with the Per item/transaction field. If that field is set to Per Item, then this number of free items are allowed before the fee is assessed; if Per Transaction, then this number of transactions are granted free.
Percentage of Checks Cashed Use this option to charge a fee that is based on the total amount of checks the member is cashing. Note that no “free” items are allowed with this method.
% for fee calculation	Enter the percentage to be used in calculating the fee.
Misc. receipt code	Regardless of which fee method you choose, use this field to enter a valid miscellaneous receipt code indicating how the fee income will be credited to the G/L.
Allow fee to be manually waived	Place a checkmark here if you wish to allow a teller or member service representative to manually modify or waive this fee at the time of the member transaction. Remove the checkmark to block users from being able to change or waive this fee. Since fees that are manually modified or waived will appear on the Fee Waiver Information Report, it may not be necessary to block manual fee waivers, but rather to keep a close eye on them through the report and improve employee education.
Charge fee if deposit or MR	This feature lets you charge your check cashing fee as a “Check Negotiation Fee” and charge it no matter what the member chooses to do with the checks - cash them, deposit them, purchase tickets or traveler's checks with them, etc. Place a checkmark here if you wish to charge this fee even if the teller proceeds to the Deposits/Withdrawals screen or the Misc. Receipts screen. Leave the flag unchecked if you want the fee to be charged ONLY when cashing a check without making any deposit or using the funds to purchase a Misc. Receipt on the main Teller Posting screen. Remember that the Allow teller to waive manually flag can still be used to control whether or not the teller can clear or change a check cashing fee according to your policies.
Non-Member Cashed Checks This section controls fees for non-members who are allowed to cash checks at the teller line. Note that no “free” items are allowed for non-members. SEE ALSO: Non-Member Teller Services
Flat Fee Use the flat fee option to charge the same fee to every non-member, regardless of the amount of checks being cashed.
Fee Amount	The total amount of the fee.
Per Item/Transaction	Used to indicate whether the fee is charged per item cashed, or once per transaction, regardless of the number of items. For example, if a non-member brings in 34 checks to be cashed at the same time, is she charged the fee 34 times for each item, or just once for the entire transaction?
Percentage of Checks Cashed Use this option to charge a fee that is based on the total amount of checks the non-member is cashing.
% for Fee Calculation	Enter the percentage to be used in calculating the fee.
Misc. Receipt Code	Regardless of which fee method you choose, use this field to enter a valid miscellaneous receipt code indicating how the fee income will be credited to the G/L. If you wish to track member income separately from non-member fee income, this should be a different code than was used for member cashed checks.
Allow fee to be manually waived	Place a checkmark here if you wish to allow a teller or MSR to manually modify or waive this fee at the time of the non-member transaction. Remove the checkmark to block users from being able to change or waive this fee. Remember that fees that are manually modified or waived will appear on the Fee Waiver Information Report so you may choose to allow manual waivers, and then keep a close eye on them through the report and improve employee education as needed.
Fee Waivers The fields in this section govern if and when fees will be waived (for members only). All fields are required. CU*TIP: Fees that are waived because of these parameters will be recorded in the Fee Waiver Information file (FWHIST) and can be viewed using the Fee Waiver Information Report (Tool #371).
Aggregate Savings	Enter the aggregate savings amount (for ALL savings and certificate accounts, including IRAs and tax escrow accounts) needed to waive the fee. Any amount equal to or greater than this amount will not incur fees, so it is not recommended that you enter 0.00 in this field. To charge this fee regardless of aggregate savings, enter all 9’s in this field.
Aggregate Loans	Enter the aggregate loan amount (for all loan and open credit accounts) needed to waive the fee. Any amount equal or greater than this amount will not incur fees, so it is not recommended that you enter 0.00 in this field. To charge this fee regardless of aggregate loans, enter all 9’s in this field.
Low Age	Enter an age. Any member at or below this age will not incur fees for cashed checks. If the field is set to 0 (zero), all ages below the High Age will be charged. For example, if you want to waive the fee for children age 18 and under, enter 18 here. Anyone age 19 and older will be charged.
High Age	Enter an age. Any member at or above this age will not incur fees for cashed checks. If the field is set to 999, all ages above the Low Age will be charged. For example, if you want to waive the fee for seniors age 55 and older, enter 55 here. Anyone age 54 and younger will be charged.
Waive if present	If you wish to waive the fee for members who have certain types of accounts or cards, place a check mark in one or more of these fields. ATM card - Waiver for ATM card. For online ATM card, card must be in active status (not, for example hot carded) for fee to be waived. For Off Trial Balance (OTB) ATM card, waives if a card is present, regardless of status. Debit card - Waiver for debit card. For online debit card, card must be in active status (not, for example hot carded) for fee to be waived. For Off Trial Balance (OTB) debit card, waives if a card is present, regardless of status. Credit card - Waiver of fee for credit cards. For online credit card, the loan must have a Process Type of V (credit card) with a status of Active (A) and not be written off (WRTOFF of 0) for fee to be waived. For Off Trial Balance (OTB) credit card, waives if a card is present, regardless of status or balance. OTB savings acct - Waives fee if member has Off Trial Balance (OTB) savings account, regardless of status or balance. OTB loan acct - Waives fee if member has Off Trial Balance (OTB) loan account, regardless of status or balance.

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Learn from a Peer (F10)

Learn more about Learn from a Peer Cash Check Fee Configuration

(This option is only available if you access the screen for use with Learn from a Peer. Use this option to select a credit union for a side by side comparison of your credit union’s Cashed Check Fee configuration and the comparison credit union’s Cashed Check Configuration. This function key will begin the process of the Learn from a Peer Cashed Check Fee Configuration and will allow you to select the asset or membership range of to select your comparison credit union.