The NCUA addresses overdraft program disclosure requirements, regardless of whether a credit union promotes the payment of overdrafts, in Part 707.
All credit unions that charge fees for paying overdrafts are required to disclose them on the periodic statement, both for the statement period and for the year-to-date. The disclosure does not have to be provided if no fees have been charged (e.g., the credit union would not have to disclose "$0" for the statement period or year-to-date).
The disclosure must be made in a tabular format and be near the other itemized fees. The final rule includes a sample form for making this disclosure. Credit unions may either use the term "returned item fee" or "NSF fee" on the form to describe the fee for returning items unpaid. The regulations require that the periodic statement disclosure be provided in tabular format, as illustrated in NCUA's model form B-12.
Periodic Statements
The credit union must separately disclose on each periodic statement:
- The total dollar amount for all fees or charges imposed on the account for paying checks or other items when there are insufficient funds and the account becomes overdrawn, using the term "Total Overdraft Fees;" and
- The total dollar amount for all fees imposed on the account for returning items unpaid.
The overdraft services covered do not include a service providing for the transfer of funds from another share account of the member to permit the payment of items without creating an overdraft, even if a fee is charged for the transfer.
These disclosures must be provided for the statement period and for the calendar year to date.
The aggregate fee disclosures required must be disclosed in close proximity to the other itemized fees, using a format substantially similar to Sample Form B-12 in Appendix B of NCUA's Rules & Regulation.
