Activating Overdraft Protection/ANR Settings

Description

Overdraft Protection

These flags control whether or not the system should use overdraft protection processing for members that are configured with ODP accounts.

If checked, the system will transfer available funds from all allowed overdraft accounts in order to cover incoming transactions being posted.

(01) Teller in house checks - This allows a member to write a check to themselves and cash it at the teller line to take their account negative into their overdraft protection (if available). This is activated by default.

(11) ACH - This will activate overdraft processing for ACH transactions. Remember that ACH transactions cannot be “reposted” like share drafts can. Overdraft protection and NSF fees activate immediately when the ACH item is posted to the member's account. If you decide not to return an ACH item, you will need to manually reverse the NSF fee.

(02) Checks - This will activate overdraft processing  for share draft postings. Remember that NSF fees are posted when you use Post NSF Fees (Tool #619: Post NSF Fees) after working share draft exceptions.

(13) PIN ATM/Debit - This will activate overdraft processing for PIN-based ATM/Debit Card transactions. Applies to ALL supported ATM/Debit Card interfaces (both batch and online), whether the transaction is posted interactively or is force-posted (offline mode)

(16) Debit card (Sig) -This will activate overdraft processing for signature-based ATM/Debit Card transactions. Applies to ALL supported ATM/Debit Card interfaces (both batch and online), whether the transaction is posted interactively or is force-posted (offline mode).

(20) Bill Pay/P2P - This will activate overdraft processing for bill payment and P2P postings (for products of the following vendors: Paymentus, Payrailz, and iPay.

If checked, CU*BASE will use balances from the member's configured overdraft protection accounts when determining available balance for transaction authorizations. (NOTE: ATM inquiries and resulting balances on ATM receipts will still show the member's real, actual balance for just the specific account being viewed.)

(13) PIN ATM/Debit - If checked, when the system authorizes a PIN-based transaction, CU*BASE will include money available in configured ODP accounts when calculating available balance. Applies ONLY to online ATM/Debit Card interfaces. (For batch processing, the available balance calculations in your Positive Balance File (PBF) are controlled by a custom program unique to your credit union. Contact a client service representative about changing your available balance calculation to include ODP balances.)

(16) Debit card (Sig) - If checked, when the system authorizes a signature-based transaction (such as when the member attempts to purchase something with a debit card), CU*BASE will include money available in configured ODP accounts when calculating available balance. Applies ONLY to online ATM/Debit Card interfaces. (For batch processing, the available balance calculations in your Positive Balance File (PBF) are controlled by a custom program unique to your credit union. Contact a client service representative about changing your available balance calculation to include ODP balances.)

ANR/Courtesy Pay

These flags control whether or not the system should use Automated Non-Return (Courtesy Pay) processing for members who have a Negative balance limit on their accounts.

• Much more detail on developing and implementing an Automated Non-Returns program is provided in the Automated Non-Returns booklet.

• NOTE:Different combinations of the “Use Negative Balance Limit for Authorizations” and “Use Negative Balance Limits for Posting” result in different actions. Checking the Authorization flag and unchecking the Posting flag is NOT recommended. Click here to learn more about these combinations and recommendations for use.

• If no box is shown for a particular process (such as ACH), it is because ANR is used automatically for these processes as long as there is a Negative balance limit on the member's account.

If checked, the system will take the account negative up to the maximum Negative balance limit on the account when posting incoming transactions.  

• Much more detail on developing and implementing an Automated Non-Returns program is provided in the Automated Non-Returns booklet.

(01) Teller withdrawals - If you wish, you can extend your overdraft services to the teller line and allow teller withdrawals to post into a negative balance, for a fee, up to the member’s negative balance limit. This is accomplished by adding the negative balance limit and subtracting the configured ANR fee to compute the available balance. This is different that Teller in house checks because it allows the teller to take the account into the ANR limit by posting a withdrawal.  Learn more in the Automated Non-Returns booklet and refer to the Teller in house checks selection below.

(01) Teller in house checks - This allows a member to write a check to take their account negative up to their negative balance limit. This is activated by default.

(13) PIN ATM/Debit - This flag will activate ANR processing when posting PIN-based ATM/Debit Card transactions. Applies to ALL supported ATM/Debit Card interfaces (both batch and online), whether the transaction is posted interactively or is force-posted (offline mode).

(16) Debit card (Sig) - This flag will activate ANR processing when posting signature-based ATM/Debit Card transactions. Applies to ALL supported ATM/Debit Card interfaces (both batch and online), whether the transaction is posted interactively or is force-posted (offline mode).

• NOTE: Keep in mind that in the batch ATM/Debit card environment, all incoming transactions are always posted, even if the account must be taken negative. The difference with these flags is whether the normal NSF fee will be charged, or if the item should be treated like a courtesy pay item with the appropriate ANR (non-return) fee and G/L interface.

• Much more detail on developing and implementing an Automated Non-Returns program is provided in the Automated Non-Returns booklet.

If checked, CU*BASE will use the member's Negative balance limit (ANR or Courtesy Pay limit) when determining available balance for transaction authorizations. (NOTE: ATM inquiries and resulting balances on ATM receipts will still show the member's real, actual balance for just the specific account being viewed.)

• This selection may help define your Overdraft Policy (as it relates to Reg E Opt In/Opt Out). For an overview of the Reg E Opt In/Opt Out features in CU*BASE, refer to the booklet Managing Your Opt In/Opt Out Reg E Offering.

(13) PIN ATM/Debit - If checked, when the system authorizes a PIN-based transaction, CU*BASE will include the negative balance limit when calculating available balance. Applies ONLY to online ATM/Debit Card interfaces. For batch processing, the available balance calculations in your Positive Balance File (PBF) are controlled by a custom program unique to your credit union. Contact a client service representative about changing the available balance calculation to include ANR limits in your PBF. (Not generally recommended, however.)

(16) Debit card (Sig) - If checked, when the system authorizes a signature-based transaction (such as when the member attempts to purchase something with a debit card), CU*BASE will include the negative balance limit when calculating available balance. Applies ONLY to online ATM/Debit Card interfaces. For batch processing, the available balance calculations in your Positive Balance File (PBF) are controlled by a custom program unique to your credit union. Contact a client service representative about changing your available balance calculation to include ANR limits in your PBF. (Not generally recommended, however.)

These flags are used only if your credit union's Courtesy Pay program policies and procedures require you to disclose NSF and non-return fee amounts on member statements.

• PLEASE NOTE: You must also change your statement print configuration. Refer to the Automated Non Returns booklet for more information.

• Also refer to the Automated Non Returns booklet for more information about the configuration needed to print the fee disclosures on your statements.

These flags let you determine which origin codes will be counted in the fee totals that are disclosed. For example, you might need to report only fees that relate to share draft postings, but not include ACH or bill payment activity, based on your interpretation of the reg. as it applies to your situation.

• NOTE: Teller In House Checks and Teller Withdrawals are both Origin 01 and these are combined to calculate the totals for Origin 01.

• Fee amounts will be counted and shown in NSF History regardless of what is checked here; these flags are used only to control what appears on statements.

These flags control whether or not NSF fees should be charged automatically on incoming transactions. NSF fees are configured by share dividend application on the Overdraft Protection & NSF Configuration screens.

The ones that are configurable are listed below.  Other origin codes are not configurable and are based on the available balance if allowed.   Learn more about transaction origin codes.

(13)PIN ATM/Debit - This flag activates NSF fees for PIN-based ATM/Debit Card transactions. Applies to ALL supported ATM/Debit Card interfaces (both batch and online).

(16) Debit Card (Sig) - This flag activates NSF fees for signature-based ATM/Debit Card transactions. Applies to ALL supported ATM/Debit Card interfaces (both batch and online).

(20)Bill Pay - This flag activates NSF fees for bill payment transactions for origin code 20.  Learn more about origin code 20.

• For more information refer to the Automated Non-Returns booklet.

(Available only for "13 PIN ATM/debit" and "16 Debit card (Sig)" only.)

Use this setting to determine if a fee should be charged when a debit transaction causes the account to dip into a negative-balance amount. 

Select "Available" to assess ANR and NSF fees when a debit card transaction causes the member's balance to fall below the member's allowed available balance.

Select "Current" to assess ANR and NSF fees when the member’s current balance goes negative, regardless of the available balance at the time of posting. 

This setting does not affect the authorization of transactions – these calculations only consider the member’s available balance.  Credit unions selecting "current balance" are simply selecting that the member’s current balance be used to determine if a fee should be charged. 

A change of this setting to current affects the NSF statistics on dashboards such as the NSF Statistics dashboard and the NSF Summary Stats screen since the count of NSFs will decrease.  (The “# of Occurrences” count indicates the number of times an item was presented as NSF.)

WARNING:  Careful analysis should be done before changing to the "current" option.  Preliminary analysis indicated that credit union revenues would drop by as much as 75-90%.

Use this flag to automatically waive any NSF/ANR fee(s) for ACH debit items that are marked as "retry" by the merchant. This will happen when an item is returned as NSF to the originating merchant or organization, who then tries to recoup that loss by re-presenting the item through the ACH a second (or sometimes a third) time.

Once you activate the flag, the change is immediate for all items currently in the warehouse and that are received going forward.

IMPORTANT NOTE: Using this flag does not guarantee that all retry items will have fee(s) waived. CU*BASE is at the mercy of outside merchants to word/code these re-presented items in a way the system can catch it in an automated fashion. For example, if a merchant has a typo in its transaction description, there is a chance the fee(s) do not get waived.

CU*Answers has identified the following transaction descriptions that the program will recognize:

RETRY
RETYR
RETRR

These are variations that were discovered during research of retry ACH items. The program will adjust over time as we see other variations that are not being caught.

This is used to control how funds are pulled to satisfy an NSF transaction through overdraft processing. If left unchecked, the system will pull funds from only one of the four accounts configured in the member's overdraft settings (will not combine funds from multiple accounts). In other words, overdraft protection will only occur if a single account has enough money to cover the item. No partial transfers will be done.

If checked, the system will search the four ODP accounts listed in each member record and pull funds from each account, one at a time, until the entire transaction amount has been satisfied.

• If funds are pulled from both a share and a loan account in order to obtain sufficient funds, your configured Combined O/D Protection Fee will be charged. Click here for more information.

• IMPORTANT: If your credit union uses Automated Non-Return processing, this flag MUST be checked.  For more information refer to the Automated Non-Returns booklet.

This area shows the date on which changes were last made to this screen, and the User ID of the person that made the changes.

Description of Result

Negative balance limits not used for either.  NSF fees will kick in if necessary and as configured.

Negative balance limits not used for authorizations. If posting causes account to go below available balance, if it is still within the negative balance limit, assess the ANR Fee with CU-defined description; otherwise use the NSF fee and standard description ("NSF FEE").

NOT USED AND NOT RECOMMENDED

Authorize using negative balance limit. If posting causes account to go below available balance, if it is still within the negative balance limit, assess the ANR fee with CU-defined description; otherwise use the NSF fee and standard description ("NSF FEE").

Where you see the biggest difference is if you have a different fee amount for NSF than for ANR.  Then it makes a difference which condition hits, as that determines which fee the member gets (and also in which fee "bucket" it is disclosed on member statements).  If the fees are the same amount there isn't a huge difference in debit card transaction postings because, remember, you must post the item if it comes in to be posted (can't be returned like a check or ACH item).  Under the new Reg. E rules, if the member does not Opt In, you can't assess a fee in any case. 

• IMPORTANT NOTE FOR BATCH (PBF) PROCESSING: Remember that if your credit union uses batch ATM/Debit processing, that authorizations are controlled by the custom PBF settings you have set up with your batch provider.  The Authorization Flag explained above does NOT apply for batch processing.