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Moebs Receives Notice of Allowance on Overdraft Checking Product Patent

Tuesday, January 05, 2010

Unique Process Allows Financial Institutions to Profitably Lower OD Fees, Control Losses and Increase Consumer Value; Reduces Costs to Consumers

Lake Bluff, IL -- Michael Moebs, CEO and economist of Moebs $ervices, an economic research firm based in Lake Bluff, Ill., has been notified a patent will be issued to his company for an invention that can be used by financial institutions offering overdraft services on consumer checking accounts.

The invention is a unique process Moebs has named Debit $coring®, enabling financial institutions to provide overdraft service to the largest number of qualified account holders possible, while simultaneously helping them manage risk, and lower their cost.

"No other methodology currently exists to do this, so we are delighted our patent was approved," said Moebs. Moebs filed the patent application in 2004 and received notice the patent is to be granted in November, 2009.

The Debit $coring process is embedded in a service sold by Moebs Services called No-Bounce® Checking. This innovative service allows financial institutions to assess consumer risk and establish a wide range of customized overdraft limits, while controlling their losses, protecting their revenue and increasing their volume of checking accounts.

"By using No-Bounce Checking, financial institutions can qualify more consumers through its selection criteria, offer meaningful OD limits for each consumer, and reduce the fees they charge for OD coverage," said Moebs. "Most importantly, this system can significantly reduce losses and protect revenue generation while building consumer satisfaction and loyalty," he added.

"Clients who use this process can charge as little as $9 to $12 for an overdraft vs. the $27 national price currently charged by banks and credit unions, yet these clients continue to earn revenue due to a higher volume of accounts and have reduced risk," said Moebs. "The low prices are half of what is currently charged and lower than fees from payday lenders – the consumer wins."

According to Moebs, when this Debit $coring process was tested in Miami, the worst checking market in the USA, banks and credit unions using the service experienced only 4 percent in losses. Other financial institutions using the traditional approach to OD coverage experience 20 to over 30 percent loss of revenue.

"I believe this process solves many of the issues financial institutions and consumers now face in the current pricing controversy impacting overdrafts," said Moebs.

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