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Overdraft Education Center |
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New Overdraft Rules Mean More Control for
Bank Customers |
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Banks will soon change the
way they offer overdraft protection on ATM and one-time debit card
transactions to their customers due to new regulations. Beginning July
1, 2010, new customers will need to “opt-in” to a bank’s overdraft
protection program in order to have these types of overdrafts honored by
their bank. Existing customers have until Aug. 15, 2010 to opt-in. The
new regulations apply to personal checking accounts only; commercial
checking accounts are exempt. |
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Consumers who “opt-in” to
their bank’s overdraft protection service may have overdraft
transactions honored in exchange for a fee. Those who do not “opt-in,”
and whose accounts are overdrawn, will have their ATM or debit card
transactions denied when there are insufficient funds in the account.
This change does not apply to checks, recurring debit card, or ACH
transactions. |
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Here is some other helpful information
about the new regulation: |
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Overdraft Opt-In Form
- Must be completed for every account. |
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Frequently Asked Questions - Common questions about the new regulation. |
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SNBT
Letter Explaining the Change |
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What You Need to Know - Link to the Federal Reserve site. |
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Have you
Decided? - Diagram outlining how the change will affect your
purchases. |
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Why should consumers agree
to an overdraft fee by opting into an overdraft program? |
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There is no fee to opt-in. A fee is
incurred only in the event you use the service.
Eighty-two percent of consumers paid no overdraft fees in the past
year. Of those who did pay an overdraft fee, 96 percent said they
were glad the payment was covered.
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A customer’s transaction may be covered
in the event they become overdrawn when they are using their ATM or
debit card at a business.
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A consumer may be covered against an
occasional accounting error if they lose track of their balances.
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Avoid denied ATM or debit card transactions by following these tips: |
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Use direct deposit for paychecks. This
will give you immediate access to your paycheck.
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Keep track of your balance,
transactions and don’t forget about automatic payments. Bank Online,
internet access, Bankline, ATMs, or simply calling your bank offers
everyone an easy way to keep track of your finances. Keep in mind
that these balances will not reflect any transaction that have not
yet reached or been processed by your bank.
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Keep extra money in your account just
to be safe.
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Don’t rely on float (the time it takes
a check to clear). Today’s payment systems are increasing in speed
which in turn means a reduction in the time it takes to clear a
check.
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