CUNA released its 2015-2016 Fees Report this week, whichmeasures and evaluates fee income areas for credit unions nationwide and offersguidelines for institutions wanting to evaluate their own feeincome programs.

According to the study, checking account fees proved to be the largest income sourcesfor credit unions, accounting for slightly more than 40% of feeincome overall. The category, which ranks a few percentage pointshigher than it did several years before, included NSF, courtesy payand overdraft protection fees.

Despite that, 79% of all credit unions surveyed offered someform of “free” checking, a much higher rate than the bankingindustry, in which only 38% of institutions offered free checkingaccording to Bankrate.com's 2014 Checking Survey.

The survey also showed that less than half of credit unions'interest-bearing checking accounts were not free to members.Additionally, 75% of credit unions that didn't offer freeinterest-bearing checking accounts had provisions allowing accountholders to avoid monthly fees by maintaining some level of minimumbalance, a ratio much higher than that of banks.

The average credit union minimum balance requirement was $969and the average penalty fee for not meeting the requirements was$6.51. By comparison, banks had a $6,211 average minimum balancerequirement and an average penalty fee of $14.76, Bankrate.com datashowed.

Among credit unions offering debit cards, 15% had rewardprograms of some type, with the program's prevalence rising as theasset size of institutions increased. A full 40% of credit unionswith $1 billion or more in assets had debit card rewardprograms.

Only 53% of credit unions offering debit/ATM cards chargedmembers a transaction fee for using an ATM not owned by the creditunion, the study said. Among those that charged, 42% gave members aspecified number of free transactions each month before assessing afee. However, the prevalence of that trend has declined, droppingfrom 48% of credit unions in 2012 and 66% in 2010.

“Setting fees is a critical task that affects sustainability forcredit unions,” Jon Haller, CUNA's director of corporate and market research,said. “While credit unions want to be low-fee financialinstitutions, they depend on fees to cover costs, offer qualityproducts and provide a higher level of service than theircompetitors. The CUNA Fees Report can help credit unionseffectively set fees that provide them the highest competitiveadvantage.”