ICUL Services Corporation Partners With Floyd & Associates for Overdraft Privilege Program - Program Helps Members Avoid Negative Consequences of Bounced Share Drafts (Checks)

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Indiana Credit Union League's subsidiary, ICUL Services Corporation, has partnered with John M. Floyd & Associates of Houston to introduce JMFA Overdraft Privilege program statewide to ICUL's more than 200 credit unions and their millions of members. With the program, members who have insufficient funds checks avoid embarrassment, merchant fees and bad credit records.

ICUL Services Corporation (Servicecorp), has signed an agreement with John M. Floyd & Associates, Inc. (JMFA) of Houston naming the profitability consulting firm as its endorsed business partner for the JMFA OVERDRAFT PRIVILEGESM program. (

Servicecorp, a subsidiary of the Indiana Credit Union League representing more than 200 credit unions, has begun marketing the program, which allows credit union members to avoid the consequences of returned checks. Other groups working with JMFA include credit union organizations in Alabama, Florida, Hawaii, Michigan, Mississippi, New Jersey, New Mexico, Pennsylvania, Tennessee, Texas and Vermont, as well as the Credit Union League of the West (CA, NV, WA, OR) and CUNA and Affiliates.

“This discreet service avoids the embarrassment of members ‘making good’ on a share draft (check) with a valued retailer,” according to CEO John M. Floyd. “Neither the member nor the merchant loses time or productivity in straightening out an NSF (insufficient funds) mess,” he says. “Members don’t wind up on retailers’ bad check lists.

“Members can avoid multiple NSF charges from a merchant or late payment penalties on mortgages, car loans or tuition payments. They also can prevent negative entries on their credit record or other legal issues created by NSFs,” he added.

Diligent Search…Member Friendly Program

“With an overdraft privilege program, Indiana credit unions have the opportunity to enhance member satisfaction while also increasing their non-interest fee income,” noted Servicecorp Chief Operating Officer Connie Curtis. “As a credit union-owned cooperative organization that networks collective business volume to offer affordable products and services, Servicecorp is well-positioned to match this product with the credit unions whose members will benefit from its availability.”

“We diligently researched and compared suppliers and programs before partnering with Floyd & Associates,” explained Curtis. “Our goal was to identify an outstanding partner that will combine all the benefits of an overdraft program with the credit union philosophy of focusing on the member’s well being. I’m convinced our partnership with Floyd & Associates will help credit unions implement member-friendly programs,” she added.

Overdraft Programs Vary Widely

JMFA, founded in 1973, is a leading provider of non-interest or fee income products to financial institutions. The company has installed profit improvement programs in 1,650-plus financial institutions, adding more than $10 billion in increased pre-tax earnings for its clients. The company also has successfully implemented variations of its overdraft privilege program in more than 550 credit unions, banks and thrifts.

“JMFA’s overdraft privilege program ( is nondiscriminatory and 100% compliant with federal and state regulations, as well as with recently suggested changes,” Floyd emphasized. “Our program has a proven track record of producing more income and less charge-offs.” He also disclosed:

•    Of 18,000 financial institutions in the United States, more than 2,000 are estimated to now have defined and communicated overdraft programs.

•    The typical fee charged on an insufficient funds (NSF) check is $17 to $35. The average is $22.50.

•    Studies indicate the average customer or member writes about 3.4 NSF items per year.

“A well-managed overdraft program is a win-win-win for the consumer, the merchant and the financial institution,” he said. “Additionally, automated programs help identify troubled accountholders for necessary counseling.”

The Federal Reserve System, at the urging of consumer advocate groups, including the National Consumer Law Center, has been reviewing compliance issues concerning “bounce protection” and similar overdraft programs. Some critics contend the programs need stricter controls under the Truth in Lending Act, however, the Fed decided in March 2003 to make no regulatory changes at that time, but to continue gathering information on the programs.

Floyd has been speaking from coast to coast this past year emphasizing the multiple benefits of overdraft programs, as well as the unfair practices endemic to the implementation, marketing and management of some overdraft programs. Some bounce or overdraft protection programs are discriminatory, over-promote the service, under-educate consumers on its use and base overdraft limits on a “mystery matrix,” he has advised consumers, regulators and bankers.

Brian R. Witt, chairman of the Credit Union Committee of the American Bar Association, agreeing with Floyd’s premise, stated in the May issue of Credit Union Magazine: “The hidden, unquantifiable costs of not covering overdrafts could be more insidious than the overdraft fees now imposed under current disclosure laws.”

JMFA creates strategic programs, including PRIVILEGE MANAGER CRM(TM) software, specific to each credit union, its organization and its market that maximizes all aspects of NSF revenue. It then delivers expert training, marketing and software to assure successful implementation and full regulatory compliance.

About the Indiana Credit Union League:

A statewide trade association representing more than 200 credit unions in Indiana, the Indiana Credit Union League and its subsidiary Servicecorp provide consultation, legislative support, public relations, operational and technical assistance, education and training, and fee-based services, such as credit card, IRA and insurance programs. The League and Servicecorp share the same office facility and have the same president and board of directors.


Floyd & Associates, Inc. PRIVILEGE MANAGER CRM(TM) is patent pending.


John M. Floyd, CEO, John M. Floyd & Associates, Houston, 800-809-2307 or 281-424-3800; Web site,; e-mail,

Preston F. Kirk, APR, Kirk Public Relations, Austin TX, 830-693-4447;

Kay Neidlinger, Vice President-Communications, 317-594-5300, Ext. 343; Fax 317-594-5301,

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Preston F. Kirk, APR
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