The Real Cost of Returned Mail

Dec 18, 2020

The envelopes with the yellow USPS sticker.

If you’re the person at the credit union responsible for keeping member addresses up to date, then you’re very familiar with these. It might even feel like there’s nothing that can be done to stop them from piling up and overwhelming your limited resources.

If you’re not that person, go find them and buy them lunch, because they are performing an absolutely essential service for your credit union: processing the returned mail. It might not sound like a big deal at first, but we’re going to take some time to really understand the scope of this process and how it affects everyone within the organization.

The good news for both of you? There are solutions out there that can streamline and minimize the impact of this process while also saving you money.

Let’s get started!

Understanding the Problem

A whopping 2.5% of all First-Class Mail® is returned. As a baseline national statistic, that implies a staggering number of mailpieces forwarded or returned to sender every single day. For a credit union with 50,000 members, that means potentially 1,250 envelopes showing up in your own mailbox after sending out a monthly statement run!

Now, that probably doesn’t happen, thanks to the coworker to whom you now owe lunch… but to what lengths are they going to keep this all under control?

It’s a manual process, for starters. Someone must collect the incoming envelopes and physically organize them. Then, the information needs be read from the yellow labels (or address service cards) and entered into the core software. But the real time-sink lies in matching up the address correction with the appropriate member. The label likely shows only an address, so the envelope must be opened to find the member number. Security is essential, so you probably redact the identifying numbers.

Is this the correct John Smith?

Do you see how this seemingly simple process can balloon out of control?

To lessen the impact, some credit unions distribute the task across a large number of employees, taking advantage of call center downtime to update member information between calls. Other credit unions may have a specific person whose entire job is dedicated to this process. No matter how it’s sliced up, all of the pieces can add up to almost one year of a credit union employee’s time. That’s valuable time that could be better spent serving your members elsewhere.

There’s also the simple fact that the mailpiece is in your hands and not in those of your member. They should have been reading that document an average of three days ago, and once corrected it will likely take another three days for the new mailpiece to arrive. That’s a considerable delay in communication when time is often of the essence.

But why do we care? Doesn’t that mean we get to print and mail another document?

Oh, no! We’re in this together! All of us, in fact.

As a print and mail vendor, the USPS holds us to a certain standard for returned mail. We are able to achieve desirable levels of postage discounts, which are passed along to you, by ensuring that the percentage of undeliverable mail we submit falls below a certain threshold. If we continue to submit mailpieces for which the USPS has previously provided corrected information, that discount can be denied. This affects not only your bottom line, but those of all the other credit unions we service.

It’s in everyone’s best interest that we get the returned mail process under control.

Better Solutions and Process Automation


So, how do we reduce the volume of returned mail?

One method is to reduce the total number of print and mail documents by converting as many members to electronic delivery as possible. This not only eliminates the problem of undeliverable addresses, but also happens to be a faster and cheaper method of communicating in general. By reducing the number of mailpieces, the number of returned envelopes is also reduced.

That’s nice and all, but isn’t there a way to address the issue more directly?

Yes, there is!

The USPS recently introduced the Address Change Service (ACS), which returns all address correction information in an electronic file format rather than a torrent of envelopes and stickers. This eliminates virtually all of the physical labor of receiving, storing (and squinting at) returned mail envelopes. You may either continue to receive the physical mailpieces along with the file, or you may opt to have the USPS securely destroy it on your behalf. And they are very serious when they say, “securely destroyed.” They physically shred and mix water with the mailpieces, resulting in an unreadable “pulp,” so your members’ information is well protected.

This is pretty good, but what about matching up the addresses with the members?

The USPS doesn’t have member numbers, so that’s still going to be a lot of work.

Here’s where we at XDI can provide a unique solution for closing the gap. We call it Enhanced Address Change Service (EnACS®), and it includes all of the information needed to update a member’s information in one electronic file. With EnACS, it’s possible to completely automate the process.

That’s like having an extra person at the credit union each year. That’s your call center taking calls instead of shuffling envelopes. That’s your members receiving their document that much quicker. That’s your fellow XDI credit unions thanking you for protecting their postage discounts.

What’s Next


If you’d like more insight into ACS, EnACS, or anything related to this topic, please reach out to us. There’s nothing we like better than talking about this stuff with our credit union friends.

EnACS® is a registered Trademark of Xpress Data, Inc. All rights reserved.

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