AACUC Conference Moves to Las Vegas
The coalition said the change is "due to circumstances beyond our control" and directed those interested in attending the conference to stay tuned to its Web site (www.aacuc.org) for more details.
The AACUC's new location and dates are Aug. 5-8 in Las Vegas.
Adding Rewards to Cards
May Not Be Enough
BOSTON -- Credit unions whose credit cards already carry rewards programs would better differentiate their cards by adding additional services rather than tacking on more rewards, according to recent research from the Aite Group.
The financial service research firm's most recent report, "Credit Card Rewards: Why Issuers Should Compete on Service," said that the proliferation of different rewards programs has blunted the impact of simply adding more rewards.
"Because so many rewards cardholders belong to other rewards programs, differentiating on product-the reward program itself-is difficult," the report said. "But few (if any) rewards-providing firms help these consumers to manage the programs they belong to. As issuers look to one-up each other with ever-expanding rewards, we believe that issuers can differentiate themselves by creating a rewards hub that enables cardholders to aggregate and integrate programs."
The study affirmed the importance of rewards programs in drawing consumers and driving card usage, but it also noted that heavy card rewards users display different behaviors that isn't always best for the issuer. Among other things, heavy card rewards users are generally not inclined to revolve a balance and pay a finance charge.
"Two-thirds of this group pays off their credit card balance in full each month, while just 9% of them make the minimum payment," the report. "Among other consumers, 40% pay their balance in full, and 17% make the minimum payment on their card balance."
On the other hand, heavy card users are inclined to use their cards to pay monthly bills, particularly Internet and wireless phone bills. They are also not inclined to consolidate their cards, the report said.
Even cardholders who are heavy users of rewards programs still express dissatisfaction with them, the research found.
Three-quarters of respondents said that they're satisfied with the types of rewards programs they belong to and the customer service provided by those programs, but just 56% expressed satisfaction with the value they get from the programs they belong to, and less than half are satisfied with how quickly they can earn points or cash, the report said.
Retirement From GFA
FITCHBURG, Mass. --- Longtime GFA Federal Credit Union CEO Charles P. Bowles announced his retirement at the end of 2008.
In his 24 years at the helm, the credit union has become a full-service financial institution, growing from one location to eight and increasing over 700% in assets. He will continue to serve on the credit union's board of directors, a volunteer position. Current GFA FCU President/Chief Operations Officer Tina Sbrega will step in as CEO.
In addition to leading GFA, Bowles has been an active member of the community and a recognized leader in the industry. He currently serves as a director for many local organizations, including the Mount Wachusett Community College Foundation, Workforce Investment Board, and also holds a volunteer leadership role with the United Way. He is also a current member of the board of directors and past chairman of EasCorp, one of 28 corporate credit unions nationally.
Additionally, he has held leadership roles on the MWCC Board of Trustees and as a director of the Thayer Symphony Orchestra, as well as having served on numerous fundraising campaigns for many local organizations. He has taught management and credit union courses through the American Institute of Banking and Mount Wachusett Community College. Bowles has been recognized for his community involvement as the Citizen of the Year by the Greater Gardner Chamber of Commerce in 1997 and the MWCC Foundation in 2004.
"It has been my pleasure to serve as CEO of GFA over the years. It has given me the opportunity to give back to the community and its members through various organizations while upholding the credit union ideal of people helping people," said Bowles.
Bethex Makes Changes
To Aid Businesses
BRONX, N.Y. -- Small and micro businesses searching for low interest rates and longer loan terms have another resource with Bethex Federal Credit Union.
A niche lender for low-credit borrowers, many of whom have been previously turned down by banks, $15 million Bethex said it has modified its business loan policy to include an interest rate reduction for business and microenterprise members. In some cases, the credit union may lengthen the term of a loan, resulting in lower monthly payments while extending the life of the loan.
As a Small Business Administration lender, Bethex' newly reduced interest rate is based on the SBA's permitted rate of prime plus 2.5 percentage points, which at press time was a total of 6.5%. By monitoring this rate on a daily basis, the credit union said it is able to offer its members the best possible rate for each loan that is approved.
Bethex loan officers "do not give much weight to credit scores or employ risk-based lending in their loan decisions," according to the credit union. Instead, loan approval is "based on an intimate knowledge of the community they serve and the relationships they have developed with their members over the years."
While raising capital is frequently a challenge for financial institutions working with impoverished populations, Bethex's partnerships over the years with New York State, New York City and the National Federal of Community Development Credit Unions has helped small and microbusinesses get off the ground and expand.
"Now that the economy has continued to deteriorate, that support may not be as readily available," the credit union said. "Bethex FCU hopes that the government rescue plans will look holistically at the nation's economic problems and support community-based financial institutions that can effectively deploy resources to low-income population."