With the arrival of 2010 financial institutions are now faced with the new Federal Regulation E Amendment related to overdraft services. There is less than six months to comply with the July deadline to meet these requirements.

The new amendment will require all financial institutions to make changes to their overdraft service.  As of July 1, 2010 the amendment will prohibit financial institutions from charging new consumers fees for paying overdrafts on ATM and one-time or everyday debit card transactions, unless the consumer consents in advance (opts-in) to the financial institutions overdraft service for those types of transactions.  The prohibition affects existing account-holders (accounts opened prior to July 1, 2010) on August 15, 2010, unless they consent as well.

For most financial institutions the new rule will negatively impact overdraft fee income generated by accountholders who overdraw checking accounts while making ATM and everyday debit card transactions.

Decreases in overdraft revenue could be staggering. Unless your financial institution takes positive action to allow accountholders to consent (opt-in) to overdraft protection for ATM and debit card transactions, you can anticipate a 25% - 45% decrease in overdraft fee income. Experts predict a 33% average decrease in existing overdraft fee income ($45 billion x .33 = $15 billion decrease).

What is your financial institution's share of these anticipated revenue losses?

IMPACT Financial Services has the solution for our clients. The IMPACT Optimizer ™ is a Regulation E Opt -In component for your IMPACT Overdraft Solutions Program.  The service is an easy, effective and inexpensive way to maximize opt-ins and sustain overdraft fee income. (Download product information flyer)

To set up a demo, please call our Marketing Administrator, Lisa Gary, at  (800) 477-9452 or send email to sales@impactfinancial.com.