Overdraft Revenue Inches Up in 2018
Overdrafts are NOW elastic. Raising price will lower revenue by reducing consumer usage.
There are ways to increase OD Revenue while helping the consumer.
Email, text or call for more.
Credit Union OD Revenue Soars, While Bank OD Revenue Declines
Lake Forest, IL (March 27, 2019) “All that glisters is not gold . . .” Shakespeare, Merchant of Venice. Total overdraft revenue increased in 2018 by 0.50% to $34.5 Billion, yet hidden behind this glister is revenue for banks declining -0.73% and thrifts declining -1.83%, while credit union OD revenue soared +5.72% to $6.9B from $6.5B. The revenue uptick was caused by banks increasing OD price to $32 from $30, and CUs increasing to $30 from $29. In line with price changes, OD transactions decreased -6.93% for banks and -0.53% for thrifts. CU transactions increased +2.19% enough to stimulate an overall increase.
“Depositories have thought the elasticity of overdrafts, or price changes vs. volume changes on ODs, was inelastic – no connection between price and volume, yet this link is no longer true,” states Michael Moebs, Economist & CEO of Moebs $ervices and author of the 132nd quarterly, consecutive Overdraft Revenue Study in the United States.
READ FULL ARTICLE
Written By: m.moebs
Date Posted: 3/27/2019
Number of Views: 313