Fee Checking May Help Boost Post-Durbin Income
Since the finalization of the Durbin Amendment, many credit unions have been considering how they will compensate for lost interchange revenue with other forms of noninterest income.
Attaching fees to checking accounts is one way CUs can help fill the gap, which leaves fee-based checking product providers with a golden opportunity to snag new members.
The big question is how can CUs convince their members to favor a fee-based checking account over a free one. Providers say CUs can overcome this dilemma by offering incentives and ways to reduce fees.
According to a BancVue case study, one Choice Checking customer charged account holders a monthly fee of $4.95, but allowed them to reduce the fee by $1.50 for using e-statements and by 15 cents for every $5 debit card purchase they made. Choice Checking also provides account holders with increased fraud prevention and a shopping discount program with local and online merchants, the company said.