Dynamic Overdraft Limits. 
Meeting Needs. Managing Risk.

Gone are the days of the “one-size-fits-all” overdraft programs where all account holders of a particular account or profile receive the same overdraft limit.

Federal regulatory guidance requires that financial institutions monitor the credit risk of each account holder and make plan adjustments “to ensure that credit risk remains in line with expectations.” This ongoing monitoring requires financial institutions to utilize advanced algorithms that analyze account holder data on a daily basis and alerts you to take action such as adjusting overdraft limits, suspending the service, suggesting counseling, etc.

Outdated overdraft systems simply cannot provide this level of sophistication. However without it, your institution is at risk for higher charge-offs and at a loss when justifying overdraft limits to regulators. You also miss out on additional fee income the service can generate as you honor more overdrafts and help more account holders meet their short-term funding needs.

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CL-call-out-box.pngCourtesyLimit is the risk management component of our automated overdraft service. This data-driven software module enables your institution to establish a risk profile for each account and assign individualized overdraft limits based on the account holder’s ability to repay at any given time. These dynamic limits are calculated automatically based on more than 20+ account holder data points, including specific deposit and overdraft activity, related balances
and more.

With dynamic limits, your institution provides account holders a personalized courtesy pay service—one that pays more items for those account holders who appreciate and can afford the service, while pulling back on overdraft limits for those account holders whose ability to repay has diminished.

CourtesyLimit allows your institution to manage revenue loss and charge-off risk; save time making fewer pay/return decisions; and help more account holders meet their short-term liquidity needs.

The software:

  • Automatically determines individual, daily overdraft limits for individual account holders
  • Sets up countless overdraft limit plans for different account groups, that include:
    • Custom settings for different risk tolerances
    • Suspension factors that set the overdraft limit to zero
    • Fixed limits for specific accounts, if desired
  • Automatically determines when corrective action is needed