Attitude, Attitude, Attitude

Credit unions have the opportunity to employ innovation and hard work to avoid losing income from new overdraft regulation.


The middle of August saw a substantial change in overdraft regulations: In order to receive the service, customers had to opt in. Although the new rule had the potential to affect fee revenue for financial institutions of all sizes, one credit union in Texas saw opportunity and seized it.

Initially, the staff at Texas Dow Employees Credit Union (Lake Jackson, TX, $1.556B) was concerned; they hoped to ensure that every member who wanted the service would have access to it. The decrease in fee revenue didn’t set them at ease either. The service charges a $25 fee per transaction covered.

But instead of simply accepting the circumstances, the staff brainstormed solutions.

“We made it an organizational focus,” says Stephanie Sherrodd, senior vice president of member services at TDECU. TDECU used mail, automated and outbound calls, advertising and in-branch screens as a means to advertise the overdraft program, which the credit union calls Courtesy Pay. There were also contests, with prizes such as an iPad or free lunches, among employees for getting opt-ins.

Once the regulation went into effect on August 15, another push, via text message, e-mail and mail, began. The credit union’s E-Commerce team developed a program that does the following: When a member is at an ATM or store and attempts to make a transaction for which they don’t have the necessary funds, the member receives either a text message, an e-mail (if they don’t have a cell phone) or a letter (if they have neither a cell phone nor e-mail address) from TDECU asking the member whether or not they might want to join Courtesy Pay.

Ultimately, all of the hard work, fresh thinking, and attention to detail paid off. The staff was able to get 75% of eligible Courtesy Pay members to opt in and 84% of all members who actively used the service to opt-in, says Sherrodd. Those who actively used the service are defined as members who paid a $25 Courtesy Pay fee within the last year.

Year over year for August, TDECU's overdraft protection income is up 24.6%.

Sherrod sees employee involvement as directly responsible for the success. The more employees talked about it, the more members learned and the more members wanted to use the program, she says.

To be sure, change can be difficult. But the approach and results at TDECU illustrate the value of attitude. Turns out all it took to turn a potential earthquake into a springboard was a little bit of effort and the right frame of mind.



Aug. 30, 2010


  • Kudos to TDECU! Great idea and nice job by all the staff for such a successful campaign!
  • Great work everyone! What a fantastic accomplishment.
    Michael Hubbell
  • TDECU takes member service to the next level! Congratulations to a great team.
  • M-O-O-N
    Nice Name
  • Interesting article and so true, all of it. Staff members informed, enthusiastic, and on top of the detail makes a difference. Back in June of this year, I did a study of FIs in my region of Michigan. At that time, out of 59 banks and credit unions, 29 had Opt-in announcements and opportunities posted on their sites. Thirty had no indication at all that this change was coming. I haven't revisited to see if the new rule had an affect or not. At the time, I guess i would call those 29 FIs early risers.