Iowa CUs Back Prize-Linked Saving Raffles
An Iowa Senate bill that would allow financial institutions to conduct savings promotion raffles is getting support from credit unions in the Hawkeye state.
According to Iowa Senate File 490, a participant would deposit a stated amount of money into specified types of savings accounts in order to participate in the raffle. A savings promotion may only be conducted by financial institutions, which includes state or federally chartered credit unions and banks.
The bill defines savings promotion raffle as a drawing conducted by one or a group of financial institutions in which the chance of winning a designated prize or prizes is obtained by the deposit of a specified amount of money in a savings account, time deposit or other savings program offered.
Several credit unions representatives recently expressed their support for the bill to Iowa Rep. Bob Kressig (D-Cedar Falls) during a credit union chapter lobbying visit
“The intent is to promote savings and is modeled after a program in Michigan where participants are eligible to receive prizes for putting money into a savings account, certificate of deposit or some other savings instrument,” said Kressig, who also serves on the board of the $1.7 billion Veridian Credit Union in Waterloo, Iowa. “Like other issues, the bank lobby is opposed to the legislation.”
The bill contains a number of conditions that credit unions and banks must meet to hold raffles including being properly licensed and to provide an annual report with information on winners and the type of prizes awarded.