As a convenience to our checking account members, MED5 offers an overdraft protection program named “Courtesy Pay”.
With Courtesy Pay, MED5 will pay a transaction even when you have insufficient funds in your checking account. To enjoy Courtesy Pay on your Visa® debit card, you are required to opt-in.
Why Should I Opt-In?
MED5 may deny your Visa® debit card purchases if our records indicate insufficient funds in your checking account and you have not opted-in to the Courtesy Pay program. Please note that members are automatically enrolled in the Courtesy Pay program for paper checks, ACH, and re-occurring debit transactions.
How Much Does It Cost?
Med5 allows members up to $800 in monthly Courtesy Pay transactions. Each Courtesy Pay transaction incurs a $30 fee. If you never use the program, you never pay a fee.
You may opt-in to the Courtesy Pay program for Visa® debit card purchases by:
- Completing the Online Opt-In Form
- Visiting any MED5 branch
- Calling (605) 342-7776
Should you have any questions regarding Courtesy Pay, please contact us or call (605) 342-7776.
Understanding Your Account Balance for Overdrafts
Your checking account has two kinds of balances: the “actual” balance and the “available” balance. You can check both balances when you view your account online, at an ATM, calling a branch, or visiting any branch location. Med5 uses the available balance to determine if a transaction will cause your account to overdraw, and for assessing overdraft fees.
The information below explains greater detail how your checking account balance works – including the difference between your actual balance and your available balance.
Your Actual Balance
Your actual balance is the amount of money in your account at any given time. The actual balance reflects transactions that have “posted” to your account. However, it does not include transactions that have been authorized and are pending. While it may seem the actual balance is the most up-to-date display of the funds that you can spend from your account, this is not always the case. Your account may have purchases, holds, fees, other charges, or deposits made on your account that have not posted and, therefore, will not appear in your actual balance.
Your Available Balance
Your available balance is the amount of money in your account available to you without incurring an overdraft fee. Your available balance takes into account transactions on-hold for deposits and withdrawals (such as pending debit card transactions) that have been authorized but have not yet posted to your account.
Example of Overdraft Fee for Insufficient Available Balance
Let’s say your available balance and your actual balance are both at $100. You meet up with a friend for a fun, relaxing meal to catch up and swipe your debit card at the restaurant for $35.
A hold for the $35 is placed on your account, resulting in your available balance reducing to $65.
Meanwhile, your actual balance remains at $100 because the transaction has not posted to your account.
Now, let’s say you wrote a check for $75 a few days ago and it clears through your account before the restaurant charge of $35.
You will now incur an overdraft fee.
Because of the $35 debit card swipe for the restaurant visit, your available balance was only at $65 when the $75 check cleared.
For members enrolled in the Courtesy Pay program (otherwise known as Overdraft Protection under a less-friendly name), MED5 will kick in and pay the $75 check. However, there is an overdraft fee of $30 per transaction. Be mindful as the fees will be deducted from your account, further reducing your checking account balance 2.
Alternatives to Overdraft Protection
MED5 offers alternative overdraft protection by linking your checking account to a line of credit and/or other deposit accounts. When accounts are linked, funds are automatically transferred at no cost to you1.
You can avoid overdraft charges by managing your checking account regularly – we recommend adding a new log with every deposit, withdrawal, check written, debit card swipe, monthly bill payments, AND any fees. By recording deposits, withdrawals and other transactions in your check register, you will have a better understanding of how much money is available in your checking account.
A great practice is to routinely review your checking account activity. You may do so by reconciling your statements, logging-in to the online or mobile branch, visiting an ATM, or by calling the credit union. Remember, some transactions may not have cleared your account, so knowing your account activity at all times will help protect you from an overdraft situation.
1You may have interest charges if you link your checking account to a line of credit. You can opt out of overdraft protection at any time.
2The amounts of any overdrafts, including our fees, are due and payable immediately or on demand.