July 10, 2006


  • The statement, "credit unions need to pay higher rates on share drafts in order to keep the accounts because they generate so much non-interest income" contains questionable logic. Share drafts are a transaction account and are NOT as rate sensitive as regular shares. Paying increased dividend rates to retain is a waste of money. If you want to stabilize or grow share drafts, make sure you first have non-cash service benefits such as free ATM transactions, free Bill-Pay and a well functioning website.
    John Nilles, RECU