Kentucky Courtesy Consumer Discretionary Overdraft Policy
This service is not a line of credit. It is a discretionary service, and not a right or obligation guaranteed to the accounts within the program, where we may approve reasonable overdrafts including any applicable fees up to the account overdraft limit when the account is in good standing. Good standing may include, but is not limited to, any or all of the following criteria and is subject to change without notice: regular deposits to cover withdrawals and the account is not overdrawn 30 consecutive days.
In an effort to maintain efficiency and control potential losses, we have a risk-based overdraft balance limit privilege feature within certain checking accounts. The rules are automated and limits are determined frequently and may increase or decrease on a daily basis.
Initial discretionary overdraft service limit for the accounts within the program at account opening is $100 and may increase over time up to a maximum of $1,500, although circumstances may change the maximum amount.
Eligibility criteria for an increase in your initial discretionary overdraft service limit may include, but is not limited to, any or all of the following criteria and is subject to change without notice:
- The age of the account
- The deposit amount and frequency history of the account
- The overdraft behavior and status of the account
- The status of any loan or other obligation to us
- The status of any legal or administrative order or levy
We have adopted this discretionary overdraft policy to provide for the highest efficiency in managing customer overdrafts consistently and fairly. At our discretion, we may pay and permit transactions for items, including checks, ATM withdrawals, debit card transactions, preauthorized automatic debits, telephone-initiated transfers or other electronic transfers, when there are not sufficient available funds. We cannot authorize or pay overdrafts for ATM or point-of-sale debit card transactions unless the account holder chooses to opt-in. If you do not authorize us to pay an overdraft on ATM and everyday debit card transactions, your transaction will be declined.
An Overdraft Fee will be assessed for each item that is paid for which sufficient funds are not available in the account’s current ledger balance to cover the item amount when it is processed each evening. There is no limit on the total fees we charge for paying your overdrafts. However, there is a daily limit on the number of items for which a fee will be assessed. Please refer to the Fee Schedule.
Multiple fees may be charged for a given item, since multiple attempts may be made to submit a returned item for payment, resulting in a fee regardless of the number of times an item is submitted or resubmitted to us for payment and regardless of whether we pay the item or return, reverse or decline the item.
A delay of one or more days can occur between a merchant’s authorization and final settlement for certain debit card point-of-sale (POS) transactions. During this time, your account’s current ledger balance may increase or decrease due to other transactions and/or fees. Therefore, the POS transaction could exceed the account’s current ledger balance at the time the transaction is presented for final settlement even if the account’s current ledger balance was sufficient to cover the transaction at the time it was initiated. This will result in an overdraft fee if you have authorized us to pay overdrafts for ATM and everyday debit card transactions. See below for an example.
||Memo Ledger Balance
||Current Ledger Balance
Although subject to change without notice, it is our current practice to process account activity each evening for items received prior to the daily cut off time. We sort items for processing first by transaction type in the following order: ATM withdrawals, debit card transactions, pre-authorized debit transactions, telephone-initiated transfers, other electronic transactions and paper-based checks or drafts. Within electronic transaction types, items are processed by the daily funds requested in amount order: lowest dollar to highest dollar. Within check transaction types, items are processed by the daily funds requested in check number order: lowest number to highest number. For example, if we receive two checks for payment and two debit card transactions in the same day, the smallest debit card transaction will be paid first, followed by the second debit card transaction; then, the smallest check number will be paid, followed by the second check. The account balance is adjusted as each item is processed for the amount of the item, if the item is paid, and/or any applicable Overdraft Fee that is charged. An Overdraft Fee may be charged for each item if the amount of the item is greater than the adjusted account balance at the time it is processed.
We are not obligated to pay any item presented for payment if your account does not contain sufficient collected (available) funds. A decision to pay any non-sufficient fund item does not obligate us to pay any additional non-sufficient fund item or to provide prior written notice of our decision to refuse to pay any additional non-sufficient fund item.
If an item is processed for payment that creates an overdraft, pursuant to the Depositor’s Account Agreement provided at account opening, you agree to pay us the amount of any overdraft and applicable fees, as published, immediately, without notice or demand from us, unless you otherwise specify that you wish all non-sufficient fund items returned, upon which you agree to pay us the amount of any applicable fee. Each account holder is jointly and individually responsible under the Depositor’s Account Agreement for paying any overdraft amounts.
It is our policy to operate in accordance with all applicable safety and soundness standards. Federal and State laws, particularly the Uniform Commercial Code, unless modified or amended by the Depositor’s Account Agreement, controls the duties, obligations and rights of the Depositor, the Authorized Signatories and the Financial Institution with regard to your checking account. The Depositor’s Account Agreement terms shall control any possible conflict, if any, between any provision of this overdraft policy and the Depositor’s Account Agreement.
We do not encourage accountholders to overdraw accounts for any reason and accountholders should not become dependent on this service to meet short-term cash needs. Abuse of this service may result in removal from the program.
We require overdrafts to be repaid on demand. In the event the account holder does not bring their account to a positive balance within 40 days, the account will be closed and reported to a consumer reporting agency and/or collection agency.
If you do not wish to be included under this policy and would prefer to have your non-sufficient fund items returned and/or denied, please call 1 (800) 467-1939. A Returned Item Fee will be assessed for each item returned.
If you would like to learn about money management, you may contact The National Foundation for Credit Counseling Network at 1-800-388-2227 or www.nfcc.org. The U.S. Government’s website dedicated to teaching all Americans the basics about financial education is www.mymoney.gov. Both The Network and MyMoney.gov are available at no charge, and neither is affiliated with Kentucky Bank.