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On Tuesday, the Saint Paul, Minn.-based Affinity Plus Federal Credit Union became the first credit union in the state to both eliminate non-sufficient funds fees (NSFs) and reform charges for courtesy payment services, according to the credit union.
In a statement from Affinity Plus ($3.8 billion in assets, 233,963 members), the credit union dropped its $35 NSF fee and overdraft fees were reduced from $35 to $15. Members who qualify for the credit union's courtesy pay will have their transaction processed without a fee if the negative balance is less than $100. A $15 fee will be charged for negative balances beyond $100.
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Affinity Plus President/CEO Dave Larson said, "It's the right thing to do for all of our members, but especially those who face financial challenges or income volatility. At a time when there's a lot of economic uncertainty, we're here to help our members keep more of their money and make finances less stressful."
The credit union said it expects these changes will result in a 63% drop in fees paid annually by its entire membership and 67% for racial minority groups. In addition, the credit union estimated roughly $5 million will be "back in the pockets of its members" in the next three years.
Larson said credit should be given to a cross-functional team at Affinity Plus who worked on the fee changes and new policies for nearly six months.
"We work collaboratively to help members experiencing financial hardship and we regularly cancel or reimburse fees for members in need – including proactively refunding more than 45,000 fees during the first year of the pandemic," Larson said. "So we've already been moving in this direction."
In the neighboring state of Iowa, Veridian Credit Union similarly announced fee changes on Tuesday. The Waterloo, Iowa-based credit union ($5.9 billion in assets, 286,872 members) has reduced overdraft fees from $32 to $20 per overdraft and fees for returned items will automatically be refunded.
"These changes help our members keep more of their own money when they need it most and give them more peace of mind in managing their finances," Veridian President/CEO Renee Christoffer said. "It's one more thing we can do to make a positive difference on their financial future."
According to Veridian, members can select to cover an overdrawn account with funds from another account or an interest-bearing line of credit without any fees.
"They can also choose for such transactions to be returned or allow their account to be overdrawn. Members who enroll in Veridian's Courtesy Pay service and allow items to be paid when funds aren't available will now pay a $20 fee for paid overdrafts, rather than the previous $32 fee. If the transaction is returned, the $20 fee will now be automatically refunded," the statement read.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
