Wondering why you’ve been bombarded with literature urging you to opt in for overdraft protection at your bank?
You may be the subject of a highly focused campaign meant to target consumers most likely to spend in excess of their balance.
Starting August 15, new Federal Reserve rules will require that banks can no longer automatically cover overdrafts and then levy a fee ($27 on average, per Moebs Services Inc.) as they had been; they’ll now need to get customers to opt in. Anyone who hasn’t said yes yet — and, by the way, we don’t think you should — is probably getting a fair share of notices by mail. But some people will be hit harder than others. Banks are employing sophisticated market research to help them identify the best prospects and how to reach them.
For example, a study conducted for bank clients by Nebraska-based Acton Marketing found that the people most likely to overdraw are white women in their late-30s/early-40s who rent homes in the south, and have annual household incomes of nearly $50,000. Acton is also helping banks market specifically to people who have racked up a lot of insufficient fund fees in the past.
If either of those sound like you, then expect lots of mail — the “most preferred method of contact,” according to the study — and even get some phone calls at the last minute. (Acton is counting it down a la Dick Clark on its website.)
“At the end of the day, [overdraft protection] is a service,” says Gary Gabelhouse, a senior market researcher at Acton. While he admits that some banks have been “abusive” and “gaudy” in their attempts to sign up customers, he adds, “The fact is that of the heavy overdraft users, 73% of them said they’d opt in to the program if they had to do it back in March.” Recent polls from other firms show that a considerable percentage of consumers would rather pay for protection than suffer embarrassment or inconvenience because of a rejected card, so for the banks, it’s just a matter of getting those people to sign up.
What say you, MONEY readers? Are you getting annoyed with a barrage of letters from your bank? Tell us in the comments section below.
Follow MONEY on Twitter at https://twitter.com/money.