A surprising number of credit unions still don't seem to takemanagement of their credit card portfoliosseriously, according to card consultants who regularly work withcredit unions to improve their credit card performance.

The executives pointed out failure to really understand somebasic card metrics, like card account profitability and what goesinto developing it as part of the problem, along with a failure toassign someone at the executive level to really take responsibilityfor growing the card program.

“I think many credit unions, most credit unions, have a staffmember who is assigned to the credit card program for the day today,” explained Brian Scott, vice president with The Members Group,a payments CUSO affiliated with the Iowa Credit Union League. “Theycan answer member questions about the cards and similar concerns,but that's not the same thing as having someone regularly take alook the portfolio from the 30,000-foot level with an eye towardsimproving profitability.”

Card consultant Ondine Irving madethe same point, though she added that the fight to get creditunions to assign someone at the executive level to the card programis an ongoing effort.

“As I have said for over 10 years, a credit card program must beproperly managed and measured,” Irving wrote in an email responseto a reporter's question. “A product champion is required to allowfor accountability and ownership. It is not enough for the cardprogram to be 'part' of someone's responsibility. The highestprofit-making product deserves its own owner.”

Scott largely agreed, adding that he was often surprised at howfew credit unions really understand how much money their creditcard programs make for them. This is a key gap in knowledgebecause, he said, without that perspective, credit union executivescan wind up making mistakes, such as making broad decisions about aportfolio based on risk alone.

“Sometimes executives will tell me they have pulled back on aportfolio because they took fraud losses of $10,000,” Scott said byway of example. “But I will point out that the same program,even with those losses, made them $190,000. Executives haveto have the complete picture to make decisions.”