LOC Disbursement Checks: Overview

Once a credit union becomes successful at line-of-credit lending, the problem shifts from approving the member and setting up the credit line, to encouraging the member to use the available credit. All kinds of marketing programs have been tried, from rate specials, to detailed letter campaigns, to give-away offers. One method that seems to be tried and true is the direct line-of-credit member check.

Often, a member will be reluctant to use an overdraft method to get LOC disbursements because the loan was sold as only a safety-net for the member's checking account. If the credit union does not constantly market other disbursement outlets (ATMs, Audio Response, and especially the Teller Line), members are generally not motivated to come in to get a disbursement from a loan officer.

To help your credit union spur lending activity, CU*BASE offers laser-printed LOC Disbursement Checks. This option allows the loan officer to print a set of checks the member can use for direct purchases, retiring debt, or other miscellaneous needs. With every new LOC account that is approved, the credit union can give offer instant access to the member's credit line.

While similar to the printed check programs associated with credit union credit cards, this program improves bottom line performance of your LOC products by keeping the credit in house and lowering both marketing and printing costs. Member LOC Disbursement Checks may be your credit union's number one lending tool this year!

Custom programming and setup if required to ensure that your LOC accounts are “check ready,” so that checks will clear the members' accounts properly. There is a one-time fee for this setup process. Contact a CU*BASE representative for details and time frames.

Remember that before your credit union can begin taking advantage of laser starter, replacement or LOC disbursement checks, you must first be set up for laser printing. See the Laser Printing with CU*BASE guide or contact a CU*BASE representative for additional information.