Account holders must meet requirements to enroll in overdraft protection and to maintain access to the overdraft line of credit. This guide is an overview of requirements for overdraft account eligibility, as well as account holder loss of access to the line of credit.
## Account holder eligibility
An account holder must meet these requirements set by Galileo to be eligible for an overdraft account:
The account holder must have an active primary account (usually a <<glossary:DDA>>) with a balance greater than or equal to zero.
The account holder must opt in to overdraft protection.
You or your bank can implement additional requirements for account holder eligibility.
After an overdraft account is created, the account holder must meet these requirements for ongoing eligibility:
The account holder must keep a correctly formatted email address on record.
The overdraft account must be paid in full within 35 days after funds are first drawn on the overdraft account (configurable).
The account holder must make at least one deposit to the primary account at or above a threshold amount within 35 days (configurable).
An automated process checks primary accounts for eligibility on a daily basis. These checks are performed only when account feature 17 for the primary account is `
P`. The process suspends the overdraft account when the primary account does not meet eligibility requirements.
## Loss of access to the line of credit
An account holder loses access to the overdraft line of credit if any disqualifying events or conditions occur. When the account holder loses access to overdraft, the overdraft account is no longer considered to be "active," meaning that qualifying transactions cannot draw on overdraft funds. Some of these disqualifying events and conditions result from account holder actions, some are technical reasons, and some result from the automated process that checks the primary account for eligibility.
This table shows how to reactivate an overdraft account that is no longer active, depending on the reason for the deactivation. You can usually see the reason on the overdraft information page in the <<glossary:CST>>.
|Disqualifying event or condition||Reactivation method|
|Account holder opts out of overdraft.||Call <a href="ref:post_setaccountfeature" target="_blank">Set Account Feature</a> to change feature 17 to `|
|All overdraft funds are used||The account holder deposits funds into the primary account to free up overdraft funds.|
|Overdraft account in `||The account holder deposits enough funds into the primary account to pay off the delinquent transaction(s).|
|Overdraft account in `||See [Suspended accounts](🔗).|
|Overdraft account in `||See [Account charge-off](🔗).|
|Primary account switches to a product that does not support overdraft||Switch the primary account to a product that supports overdraft using <a href="ref:post_switchproduct" target="_blank">Switch Product</a>, <a href="ref:post_setaccountfeature" target="_blank">Set Account Feature</a>, or the CST.|
|Overdraft account does not exist||Use <a href="ref:post_addaccount" target="_blank">Add Account</a> to create the overdraft account or add it using the CST. See <a href="doc:creating-an-overdraft-account" target="_blank">Creating an Overdraft Account</a> for instructions.|
### Suspended accounts
An account in `
status: K` has been suspended or "frozen." This table shows how to reactivate an account that has been frozen, depending on the reason for the suspension.
|Suspension reason||Reactivation method|
|Account holder does not have a properly formatted email address on record.||Use the CST or <a href="ref:post_updateaccount" target="_blank">Update Account</a> to provide a valid email address on the primary account.|
|A qualifying deposit has not been made to the primary account, or the primary account balance is not higher than 0.00.||Account holder deposits sufficient funds into the primary account.|
|Fee cap limit has been reached, either the number of fees or the total fee amount||Wait until the first day of the next month, when automated processes restore the account. Account feature 17 must already be `|
|Account feature 17 is not `||Call <a href="ref:post_setaccountfeature" target="_blank">Set Account Feature</a> to set feature 17 to `|
### Manually disabling an overdraft account
To manually prevent a primary account from drawing funds from the overdraft account, you have these options:
Freeze the overdraft account
Opt out of the overdraft account
#### Freezing the overdraft account
An overdraft account will be frozen by Galileo processes when an overdraft account exceeds the fee cap limit for the month. You can also freeze an overdraft account using the Program API by following the instructions below.
When the overdraft account is frozen, the primary account cannot draw funds from it, but the account holder can still deposit funds into the primary account, which go toward paying the overdraft balance. Be advised that on the first day of the month, Galileo processes will automatically unfreeze a frozen overdraft account if the primary account meets system eligibility requirements, even if you freeze the account manually.
To freeze the overdraft account manually, call the <a href="ref:post_modifystatus" target="_blank">Modify Status</a> endpoint with these values:
accountNo: <overdraft PRN>`
Freezing an overdraft account does not change its status, nor does it change account feature 17 for the primary account. You can see the freeze status for the overdraft account by calling <a href="ref:post_getoverdraftbalance" target="_blank">Get Overdraft Balance</a>.
To unfreeze an overdraft account, call the <a href="ref:post_modifystatus" target="_blank">Modify Status</a> endpoint with these values:
accountNo: <overdraft PRN>`
#### Opting out of the overdraft account
Call the <a href="ref:post_setaccountfeature" target="_blank">Set Account Feature</a> endpoint with these parameters:
accountNo: <primary account>`
This setting prevents the primary account from drawing on the overdraft account as well as prevents the internal Galileo processes from activating the account. Galileo processes will not change account feature 17 to `
P` after you have set it to `
E` in this manner.
When account feature 17 is `
I` or `
E`, the account holder can still deposit funds in the primary account, and those funds will go toward paying off the overdraft balance.
### Account charge-off
If funds owed against an overdraft account remain unpaid for a configurable period of time (usually 35 days), the account is considered to be in default and Galileo starts the charge-off process. Funds are swept from the overdraft account to the primary account, then from the primary account to your charge-off account. For more information, see the workflow, <a href="doc:overdraft-workflows#funds-transfer-in-case-of-non-repayment" target="_blank">Funds transfer in case of non-repayment</a>.
#### Charge-off recovery
Charge-off recovery is an optional feature that allows Galileo to reactivate an account holder’s primary account after it has been charged off. When configured, any funds loaded into the primary account after closure trigger the transfer of the amount that was charged off from the primary to the overdraft account.
If the primary account balance is less than the charge-off amount, all available funds are transferred to the overdraft account. The primary account will have a balance of 0.00, and the overdraft and primary account will remain in a charge-off status until the overdraft amount is repaid in full and the primary account balance is at least 0.01.
If the primary account balance is greater than the charge-off amount, only the charge-off amount is transferred to the overdraft account. The primary account is reopened and the account holder can use it for transactions, but the overdraft account remains closed. To reactivate overdraft protection, you or the account holder must contact Galileo Customer Service.
When charge-off recovery is not configured, if funds are transferred into the primary account, Galileo takes no action and the account holder must contact Customer Service to pay the charge-off amount owed and to reactivate overdraft protection.
## Activation and deactivation events
You receive overdraft-related events according to your arrangements with Galileo. Galileo does not generate an event message for every disqualifying event or condition. For example, if the primary account switches to a product that does not support overdraft, you get the product-switch event (`
PSWC: product_switched`) but you are not notified that overdraft is no longer available. Likewise, if you create a primary account and make it eligible for overdraft but do not create the overdraft account, there is no event message to remind you that the overdraft account needs to be created.
When the status of an overdraft account changes, Galileo sends you the <a href="ref:api-reference-events-api-overdraft-status-change" target="_blank">`
ODSC: overdraft_status_change`</a> event. Depending on the new status, you will also receive these events:
K` (suspended, frozen) — <a href="ref:api-reference-events-api-overdraft-suspended" target="_blank">`
N` (active) — <a href="ref:api-reference-events-api-overdraft-limit-change" target="_blank">`
ODSN: overdraft_limit_change`</a> (a misnomer: the limit is not changed)
When the status changes to `
R` (charged off) or `
Q` (delinquent), you do not receive a separate notification. However, the primary account will be in the same status as the overdraft account.
## Account holder inquiries
You configure your own system to handle account holder inquiries about overdraft account eligibility and usage. Galileo offers the following services that you can incorporate.
**Monitoring and notifications** — Galileo reports events, such as change in account holder status, funds used, funds owed, and program rule compliance. You can access this data using Galileo’s Events API (see <a href="doc:overdraft-operational-setup#events-api-webhooks-for-overdraft" target="_blank">Events API webhooks for overdraft</a>) and the Customer Service Tool (see <a href="doc:overdraft-operational-setup#viewing-overdraft-accounts-in-the-cst" target="_blank">Viewing overdraft accounts in the CST</a>).
**Custom data files (CDFs)** — You can retrieve overdraft-related data at the program and product level from Galileo’s CDFs, delivered via SFTP, or in real time from gAnalytics reports.