North Carolina last week became the latest state to achieve progress on allowing credit unions to start offering a “Save to Win” savings sweepstakes program.
In a unanimous vote, the North Carolina Senate adopted an industry-backed bill to permit the savings account programs tied to monthly raffles and grand prize drawings.
There had been initial concern that the North Carolina bill might run into opposition from the banking lobby or faith-based groups objecting to a “gambling” complaint, but those fears seemed to have dissipated.
Under the program, patterned after one under way in Michigan since 2009 and sponsored by the Michigan Credit Union League, participants can open a $25 certificate of deposit making them eligible to enter the sweepstakes program.
In North Carolina, the current two-raffle drawing per year limit would be eased, allowing members to participate for the monthly drawings, all designed to encourage savings practices.
The bill, due for hearings before the House Banking Committee, still might face some objection following reported grumbling by the Christian Coalition over the gambling issue. The Senate bill defines a savings promotion raffle under general statutes requiring that money be deposited into the special savings account.
The North Carolina Credit Union League said the initial opposition was from a group not affiliated with the Christian Coalition and that its concerns had been resolved.
Wash. Gov. Signs Raffle Bill
The national push to get more credit unions to offer prize-linked savings accounts cleared a new hurdle with signing of enabling legislation by Washington state Gov. Christine Gregoire.
The new savings raffle law takes effect in 90 days, though CUs are not expected to introduce the accounts until next January.
The Washington raffles law, whose passage was spearheaded by the Northwest Credit Union Association as it has been elsewhere by other state leagues, “will allow financial institutions to encourage savings with innovative solutions,” said NWCA President/CEO John Annaloro. He noted in a press statement that CUs “are seemingly the only group offering” such a product. The account is being promoted as part of “a complex societal trend," said Annaloro, and it comes as household savings rates have been in a decade-long decline.
The prize-linked savings bill was “on a fast track through the legislature,” he continued. It passed the House 91-2 preceded by a 46-0 vote in the state Senate.
“This legislation rewards thriftiness and that is a good thing," stated the bill’s prime sponsor, Sen. Derek Kilmer, during the Senate debate. “This program doesn’t just encourage people to save, it’s actually shown to actually improve their saving habits. This isn’t a new government program.”