What is Privilege Pay?
- Privilege Pay is an organized system for paying an item presented for payment against a member’s checking account, even if it causes the account to become overdrawn (versus returning the item).
How does it work?
- No applications/No signatures required
- May automatically pay items up to Privilege Pay limit of $750 including the Privilege Pay fee(s)
- Added at our discretion to member accounts considered in good standing
Good Standing means, for example:
- Making regular deposits
- Bringing the account to a positive balance every 30 days
- No legal orders against the account
- Valid Address
- No loans in default
What are the fees?
- No monthly service charge for the Privilege Pay service
- $32 for each item that overdraws the account. Same fee whether the item is paid using Privilege Pay or returned for insufficient funds
- Saves the embarrassment of items returned for insufficient funds
- Saves money on returned check charges from the merchant
- Saves money on added merchant collection agency fees
- Protects good credit rating
- Peace of mind
Privilege Pay does not create bad habits.
Privilege Pay provides a valuable service in a society where there has been a significant change in the way people manage their money.
- 89% of Americans do not balance their checkbooks;
- Of the 11% that do, approximately half balance only once per year.
Why do members use Privilege Pay?
- Calculation errors in checkbook register
- ATM transactions not recorded
- Necessities or Emergencies
- Privilege Pay fee is much cheaper than Payday Lender fees or other fees
Frequently Asked Questions
1. Does the credit union offer other forms of protection from overdrafts?
Yes! Please speak with a member service representative about alternative forms of overdraft protection.
2. What if I have more than one checking account? Will I receive Privilege Pay on just one, or all accounts?
At its discretion, the credit union may limit the number of Privilege Pay- eligible accounts allowed.
3. What do I have to do in order to apply for Privilege Pay?
You don’t need to do anything. We may assign you a Privilege Pay limit of $750 at our discretion.
4. How much will it cost me?
Privilege Pay doesn’t cost you anything unless you use it. If you overdraw your account with a non-sufficient funds (NSF) item that is paid by the credit union, then it will cost you whatever the disclosed NSF fees are on the current fee schedule.
5. Is Privilege Pay a loan?
No, it is a non-contractual courtesy that we extend to our members who maintain their checking accounts in good standing. This feature is discretionary on the part of the credit union. The words, “discretion” and “discretionary,” however used, means there is no promise to pay. The Privilege Pay is not guaranteed. Privilege Pay can be taken away at any time the credit union determines the account is no longer in good standing. In large measure, whether or not we decide to pay your overdraft item depends on how you manage the account.
6. Besides a check written to another party, what other types of transactions may access my Privilege Pay limit?
The following types of transactions may access your Privilege Pay limit:
- ATM transactions (if you opt-in)
- POS (point of sale) debit card transactions (if you opt-in)
- Debit card signature- based transactions (if you opt-in)
- ACH/pre-authorized draft and/or electronic debits
- Online banking and/or online bill pay transactions
- Checks presented for cash at the teller line
- Checks that come through electronically
- Audio response systems
7. When do I have to repay the overdraft(s)?
Normally, any overdraft amount, plus our per- item NSF or Privilege Pay fee(s) are due payable in 30 days or less. However, we can demand repayment at any time we feel it is necessary. Any deposits you make will first be applied to recovering any overdrawn balance.
8. When does the Privilege Pay clock start running? What does it mean to bring the account current? How long does the account have to stay current?
The 30-day clock begins with the date of the first overdraft. The account must be brought current and stay current through one complete cycle – often referred to as the “end-of-day” balance.
9. What kind of notices will the member receive if their account is overdrawn? How will the credit union collect the Privilege Pay balances?
The credit union will generate a paid notice for each item that overdraws the account, showing that the item has been paid via Privilege Pay. Additional collection letters will be generated if the account remains overdrawn. The Privilege Pay service will be discontinued if the account is not brought current within 30 days and the account will be closed if no arrangement for repayment has been made.
10. Can I get a larger Privilege Pay limit?
We offer one limit for all participants.
11. Can I take Privilege Pay off of my account?
Whether we pay or return an overdraft item, a fee will be assessed, either as a Privilege Pay fee or an NSF fee. We can change your account status so that no NSF items will be paid into overdraft. Please understand, however, that any future NSF items presented for payment against your account may be returned unpaid and our standard NSF return fee will still be charged. In addition, you may be charged more fees by the merchant/payee.
12. How do I opt-out of the Privilege Pay program?
Please complete an opt-out form available at any branch office or call 508-559-5400.
13. With Privilege Pay, aren’t you encouraging me to write bad checks?
No. We’re simply acknowledging a change in the way members manage their money, and that honest mistakes occur even among the best record keepers. With the Privilege Pay program, we believe we are providing a valuable service. A fee will be assessed whether we pay or return an item that is presented against an account with insufficient funds to cover the item. Privilege Pay allows us to pay the item and apply the applicable NSF fee or Privilege Pay fee.
14. How can I avoid losing the Privilege Pay service?
By complying with the basic requirements for the account, and maintaining the account in good standing.
15. I didn’t receive a Privilege Pay limit and want one. What is required to initiate or reinstate Privilege Pay?
Privilege Pay may be added, revoked, or reinstated by designated Privilege Pay staff or a member of credit union management. Members who have their Privilege Pay revoked will be periodically reviewed for reinstatement.