Can You Hear the Clamor: "No Overdraft Fees Ever Account"

The Pew Trust released yesterday another report on bank overdraft fees expressing that “persistent confusion and concern” exists among consumers about financial institution overdraft fees. My fellow bankers are you listening? 

• 52% of over drafters explain they do not understand Reg E or the Opt In/Opt Out process.

•  68% who had an overdraft would rather have the item declined rather than paid.  

• Even 77% of the customers interviewed who never have an overdraft (“never negatives”) want items declined and are fearful of overdraft fees.

     The report has already been picked up for coverage by national newspapers, television networks blogs, .  Can the clarion call be any louder, stronger, clearer or more direct?  The market wants a checking account option with the certainty of “no overdraft fees ever.”

Yet no bank or credit union in the nation (except our clients) offers a checking account with no overdraft fees ever, not even return check fee charges.  But Walmart does with the BlueBird account.  Only a handful of financial institutions (other than our clients) offer a debit card marketed as “no overdraft fees ever.”  But for 10 years now studies show prepaid card companies  from GreenDot and GoBank to American Express Serve card, BankSimple and even some bank prepaid cards like PNC’s SmartAccess have made “no overdraft fees” their marketing slogan. Prepaid transactions are nearly 20% of all debit transactions, and consumers pay more for prepaid card services than they pay in bank checking account maintenance fees.

Can you hear your prospects and consumers clearly asking you this question: “Could I have an account with the certainty of no overdraft fees ever?”  It is time to start answering yes.  

Don’t fight by saying the FDIC implemented Reg E announcing extensive research with consumers that the form they required for Opt In was thoroughly researched for clarity. Consumers don’t understand Reg E.  Don’t be defensive and say consumers really want to avoid merchant return checking fees.  Consumers do not write checks to merchants anymore. Don’t argue that consumers should manage their accounts prudently.  Transactions are made with cards today where consumers prudently want items declined when funds don’t exist in their accounts.  And don’t worry that offering consumers the option of “no overdraft fees ever” with a full service checking account will cannibalize your existing revenue.  The market segments are different and the products are configured separately.

Instead, listen and respond to your customer needs.   Responding to consumers screaming and begging for “no overdraft fees ever” will recapture transactions your customers are giving to other payment alternatives, grow your overall revenues 30%, and drive new account acquisition by appealing to the most significant customer concern in the market place today.  All by simply offering a sound way to pay for things with the certainty of “no overdraft fees” ever, greater security shopping online and in-store and planned, affordable liquidity when the customer desires it and is credit worthy:  PaySound^® “No Overdraft Fees Ever” Checking Plan and Companion Card.