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ANCHORAGE, Alaska – Alaska USA believes it is the first credit union in the nation to tap into the power of the MasterCard RPPS network to receive electronic payments from credit counseling agencies and pro-rating firms. Many credit unions have relationships with credit counseling agencies that help consumers repay their debt obligations. Typically the checks come directly from the counseling agency to the CU, and the CU then has to turn around and cut its own check to give the agency its “fair share” (a percentage of the payment, Alaska USA pays 15%). Alaska USA said it has streamlined this paper process by partnering with Minnetonka, Minnesota-based Vanco Services. Vanco specializes in payment solutions and has a direct connection with MasterCard RPPS, thus giving Alaska USA access to that network which it would be too small to have on its own. The payments come in via ACH in “net” form so Alaska USA no longer has to mail a check to the credit counseling agency. Checks used to come in “net” and “gross”, thus forcing the CU to determine which checks require a fair share payment from accounts payable. “The advantage for us is that we don’t have to go through all the paperwork. We used to have to save the checks coming in as back-up for requests that we make to our accounts payable to send fair share amounts to the agencies,” said Carol Bridges, Special Credits Administration Manager for Alaska USA. “From the agencies’ standpoint, they don’t have to send statements, so it’s just a cleaner, neater process.” And it of course it will save the CU and the agencies money. “It’s also a much better way for us to keep records. Since it’s all electronically processed we have copies of those electronic payment statements,” said Bridges. She said it will especially help at the end of the year when 1099s have to go out. The CU then discovered another incidental benefit. It can now accept Alaska USA bill payments electronically. So a member wanting to pay their Alaska USA car loan, can now electronically have that bill paid through MasterCard RPPS. For example if an Alaska USA member who also banks at Washington Mutual goes to pay an Alaska USA loan online via Washington Mutual, Washington Mutual will see that Vanco is a consolidator for Alaska USA and have the payment sent electronically. Other creditors know this is available because Vanco registered Alaska USA on the biller directories used by all credit counseling and bill payment agencies. Again paper is eliminated, but also any mistakes are caught. “All electronic payments have masking numbers. The account numbers sent with the payments have to fit in with criteria that matches the credit union account numbers. Payments are rejected if they don’t fit in those masking numbers,” said Bridges. Volume continues to grow at Alaska USA. “We started out with $5,800 on bill pay. Today we are due to get in $61,700. The highest amount we’ve received from the credit counseling at this point has been $2,000 a day, but we expect that to grow considerably,” said Bridges. Len Thiede, VP of Sales and Marketing at Vanco said this is a perfect solution for credit unions wanting to eliminate paper processing. He said Vanco is authorized to register credit unions with the big clearinghouses and there are a few other CUs currently looking at this service. “We are the ones that deliver the payments from MasterCard to the credit union. We’re a consolidator, we get the big file from MasterCard with all the companies and go through and do the ACH credits,” said Thiede. [email protected]

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