Over the last few years, banks have slowly started getting rid of overdraft fees. Smaller financial institutions (FIs) like credit unions and community banks are starting to follow suit. Especially looking to 2024, many FIs will be modeling ways to decrease or even eliminate overdraft fees altogether. The impacts are dual-sided. On one side of the coin, FIs will become more attractive to consumers. But on the other hand, they lose a source of income—and it could be a big one at that. According to the CFPB, frequent overdrafters accounted for 9 percent of accounts, but paid nearly 80 percent of all overdraft and NSF fees in 2017.

By reducing or eliminating overdraft fees, FIs will have to find different methods to manage budgets. They may consider cutting back on new products or services, getting more rigid about what they’ll execute, or finding ways to create additional revenue. If you’re also looking to cut overdraft fees and are feeling the pressure from budget constraints, the right AI solution can help you stay budget-neutral—even budget-positive—in 2024.

3 Ways Posh AI Helps FI’s Stay Budget-Positive

Smaller financial institutions like credit unions and community banks are already feeling pressure from big banks on many fronts. Big entities have turned to AI to provide personalized banking experiences and assist customers with routine tasks and questions, cutting into an FI’s bread and butter. Now, they’re slashing overdraft fees to look even better to consumers. As FI’s follow suit and reduce their own overdraft fees, they need to look for strategic ways to combat budget constraints. As a purpose-built tool for the financial industry, Posh AI can provide significant ROI in three ways:

1) Resource light. If you're considering an AI solution like Posh to help with answering routine questions or performing routine tasks, you may already be facing some resource challenges. The last thing we want to do is give you additional work that requires dedicated staffing. Posh doesn’t require dedicated full-time staff to implement, maintain, or scale. Our firm understanding and history with AI technology means that we bring the expertise to you by baking our expertise into our products. As Hudson Valley Credit Union said, “Agents are happy that chatbots are taking on interactions that require no skills. Our agents now enjoy more engaging conversations with members that go deeper. They’re using their skills and are more engaged, so our agents are more satisfied with the work they’re doing. Happy staff make happy members.”

2) Cost savings. Any value-driven solution will provide ROI in real, tangible ways. Posh AI is no different. One of the biggest strengths of AI lies in its flexibility. Financial institutions can leverage AI to support a variety of workflows or teams, whether it impacts third-party call center needs, overflow replacements, onboarding efficiencies, and streamlined processes. Posh delivers true cost savings to our customers based on their unique implementations and needs. For example, we: 

• Saved Citadel $663,267 in third-party costs
• Eliminated Freedom First Credit Union’s overflow provider to save over $225,000 every year
• Reduced calls to the contact center for One Nevada by 20 percent

3) Continued partnership. Posh’s shared technology and personalized implementation provides unique conversational AI solutions. But we don’t stop at implementation. Our Partnership for Life promises a proactive, consultative approach, meaning we continuously share ongoing best practices and strategy sessions with clients. Our consultative approach to implementing unique solutions is beloved by customers, including Florida Credit Union who said, “Posh understood not all credit unions are the same and worked with FCU to match our needs with their products and services. Together we have built out a roadmap for conversational AI that aligns with our members' needs and business goals.”

Especially looking ahead to 2024, the financial industry anticipates major changes regarding AI coming out of the recent executive order. FIs don’t need to navigate the new regulations, rules, and opportunities alone; as your partner, we will work through changes with you.

AI for Credit Unions and Banks

As you look to eliminate or reduce overdraft fees in 2024, you have an opportunity to take advantage of the same technology that big banks will use in order to stay competitive. Posh AI helps CUs and community banks bridge the technology gap, see tangible ROI, and stay competitive. For more information on how Posh can help you, visit AI for Credit Unions or AI for Banking.