Using the Account Analysis ECR to Increase Non-Interest Income

The earnings allowance rate is one of the most powerful tools that commercially focused financial institutions have for crafting an account analysis offering.

Financial institutions have traditionally assigned an earnings credit rate (ECR) to their analyzed accounts that enjoy an earnings allowance based on their balances. This rate calculates an allowance that is used to offset service fees. To be competitive, a financial institution typically offers customers its very best earnings credit rate.

New tools make it possible to create tiered-rate structures for plateau pricing and even blended earnings allowance rates. These tiered rates can increase a financial organization’s non-interest income significantly, without any effect on its best customers.