The settings that control how this works are part of Tool #558 NSF/Overdraft Transfer Configuration, on the Overdraft Protection Activation screen.  There are two flags for ANR/courtesy pay: "Use Negative Balance Limits for Authorizations" and "Use Negative Balance Limits for Posting". They control whether the member's ANR limit is added when determining the available balance amount.  There are four different combinations of these flags:

Where you see the biggest difference is if you have a different fee amount for NSF than for ANR.  Then it makes a difference which condition hits, as that determines which fee the member gets (and also in which fee "bucket" it is disclosed on member statements).  If the fees are the same amount, there isn't a huge difference in debit card transaction postings because, remember, you must post the item if it comes in to be posted (can't be returned like a check or ACH item).  Under the new Reg. E rules, if the member does not Opt In, you can't assess a fee in any case. 

IMPORTANT NOTE FOR BATCH (PBF) PROCESSING: Remember that if your credit union uses batch ATM/Debit processing, authorizations are controlled by the custom PBF settings you have set up with your batch provider.  The Authorization Flag explained above does NOT apply for batch processing.