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#1932225 - 06/13/14 12:34 PM RDC Customer Approval Criteria - NSFs?
Deena Offline
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Deena
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PA
Does anyone use number of NSFs and/or returned items as a factor to be considered when approving a customer for RDC? If so, how many do you allow? We have someone proposing a limit of 4 NSFs in a 30-day period and no more than 10 returned items in a 30-day period. Others think the number of NSFs should not be used, but rather the number of business days consecutively overdrawn (they're proposing to limit this to 7). Can anyone share what they consider and/or what's a best practice?
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eBanking / Technology
#1932283 - 06/13/14 01:52 PM Re: RDC Customer Approval Criteria - NSFs? Deena
ACHguru125 Offline
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Joined: Nov 2013
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We do not use NSF history or previous overdrawn balance information. We have created tiers and based on your account type, you will be placed in the corresponding tier.

Depending on the size of your bank, I think you will find that trying to verify this information for each registration may be too time consuming unless you have your system checking it for you. I would be interested in hearing what other banks are doing though. The more this product grows in popularity, the greater the risk will be. We are committed to minimizing our risk as much as possible.

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#1932332 - 06/13/14 02:29 PM Re: RDC Customer Approval Criteria - NSFs? ACHguru125
Deena Offline
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Deena
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We do a suitability analysis before we allow any customer to have the service. We are in the process of reevaluating the criteria we use for that analysis. I'm not sure how it would work with tiers.
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#1932373 - 06/13/14 03:08 PM Re: RDC Customer Approval Criteria - NSFs? Deena
ACHguru125 Offline
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95% of our customers who apply for the service fall into our "default" group. They are only allowed to deposit up to a certain dollar amount per day and per deposit, and then they have a monthly dollar limit as well. We have some accounts that are considered "private banking" accounts, and they have a larger deposit amount, and then we have some accounts that are second chance type of accounts; these accounts are not allowed access to the service at all.

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#1932393 - 06/13/14 03:24 PM Re: RDC Customer Approval Criteria - NSFs? ACHguru125
Deena Offline
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Deena
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Thanks - it sounds like maybe you're talking about mobile RDC. We haven't rolled that out yet. I'm talking about "basic" (not sure what the proper term would be) RDC where we provide the business with a machine.
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#1932424 - 06/13/14 04:00 PM Re: RDC Customer Approval Criteria - NSFs? Deena
ACHguru125 Offline
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Joined: Nov 2013
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I had a big long reply typed up and then lost it. GRRR....

Sorry to have misinterpreted your original post. MRDC is our most recent project and has been on my mind the most lately.

RDC for business customers is handled by two other ladies in my dept. Clients who show interest in the product will tell us what deposit limit they think they will need and we see if we find this to be suitable according to our risk assessment. I don’t know all the specifics, but the majority of those customers are considered "low" risk, and we normally don’t have a problem fulfilling their needs.

That is just a basic overview, I am sure there are more specifics I am not touching on, but since I don’t handle the day to day work of this product and the annual assessments I don’t think I would be able to offer anything else regarding this topic without possibly giving bad info.

Hopefully one of the gurus will chime in soon. smile

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#1943149 - 07/18/14 07:46 PM Re: RDC Customer Approval Criteria - NSFs? Deena
clueless Offline
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Joined: Jan 2013
Posts: 29
We do take NSF's into factor. We classify the customers to Low, Medium and High where low is less than 2 NSF's in a 60 day period. More than 3 is considered high. We are kind of strict but RDC is very risky service and is limited to well vetted customers. All Returns (with exception of NSF reason)are also taken into consideration.

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#1945517 - 07/24/14 08:36 PM Re: RDC Customer Approval Criteria - NSFs? Deena
Deedoubleu Offline
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Joined: Oct 2008
Posts: 67
Does anyone use credit reports on business customers (principals or signors)? If so and you deny them service is an adverse action required?

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#1945945 - 07/25/14 05:16 PM Re: RDC Customer Approval Criteria - NSFs? Deedoubleu
Andy_Z Offline
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Originally Posted By: deedoubleu
Does anyone use credit reports on business customers (principals or signors)? If so and you deny them service is an adverse action required?


Two key issues here:

http://www.bankersonline.com/articles/v07n03/v07n03a2.html

http://www.bankersonline.com/articles/v05n10/v05n10a1.html
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