RALEIGH, N.C.-With one exeption, credit unions that spoke with Credit Union Journal reported they have not altered pricing to encourage members to opt-in to overdraft programs. The $2-billion Coastal FCU in Raleigh, N.C., for instance, developed a unique promotion to charge a penny for overdraft fees if members correct the overdraft quickly (Credit Union Journal, Aug. 23).

The move led to significant media coverage for Coastal FCU.The one-cent overdraft fee applies when members correct the problem before 11 p.m. the same day they overdraft, or in cases where their account balances are not more than $10 in the red. Accounts that are more than $10 overdrawn after 11 p.m. are charged the standard $28 fee.

Marketing Communications Manager Joe Mecca said CFCU expected to lose 20% in revenue due to the price drop, but has only lost 15%. Had the credit union not made the marketing move, Mecca believes it would have lost substantially more overdraft income.

"So far it is working, and we are 5% better than we expected," explained Mecca, who said the promotion is designed to create more overdraft users and drive new checking account openings. CFCU has opted in 71% of users the CU has identified as moderate or heavy overdraft users.

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