Patronage Refunds Can Fuel Member Loyalty
Ask Joel Dahlgren how to build a bigger, more financially stable, better-capitalized credit union and this Minnesota lawyer’s advice is surprising: regularly give away capital to members.
“It works in the cooperative world, and it would work for credit unions,” said Dalhgren, founder of Black Dog Co-Op Law and a longtime consultant to cooperatives. He also recently co-authored “Credit Union and Cooperative Patronage Refunds,” a report issued by the Filene Research Institute.
The more touch points a member has with the credit union, the bigger the dividend. Payouts ranged from $10 to the several hundreds of dollars and, said Mislansky, the program has become a cornerstone of Wright-Patt’s marketing.
“We actively poke fun at the banks in our marketing. ‘When was the last time your bank gave you money back?’ We have gotten a very positive response from our members, and our membership is growing 8% to 10% per year.”