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ROCKY HILL, Conn. – Nutmeg State Federal Credit Union here is finding product bundling, particularly with free bill payment services, is a charmer in drawing new accounts. “We’re doing great with our bill payer program ever since we bundled it with debit, checking, home banking and direct deposit,” explained Loren Dickinson, president and CEO of the $277 million Nutmeg State. The Connecticut-based CU is using “Paylynx” offered by PSCU Financial Services Inc. of St. Petersburg, Fla. and has opened 58 new accounts since offering the bill payer service for free May 1. The CU considers the 58 accounts a strong showing with June openings on an equal pace, said Lisa Asadourian, Nutmeg’s marketing manager. Nutmeg State FCU first introduced “Paylynx” a year ago but charged $6.95 for the service. It has since dropped the fee to $4.95 as a stand-alone service. Nutmeg in its promotion, notes that “When you take advantage of our FREE Checking Account, FREE ATM/Debit Card, Direct Deposit, and FREE PC Banking, we’ll provide you with our electronic bill payer service, e-Pay, at no charge.” But for those members already signed up for the service, “the lower cost of $4.95 per month will automatically take effect as of May 1, 2003.” A spokesman for PSCU said it has 85 CUs around the country signed up for its bill pay service, with 100,000 subscribers growing at the rate of 6% a month. The idea of offering the service as part of a package is being tested by several CUs, she said, but growth of the product reflects “price sensitivity” of CU members, many of whom are high tech oriented and were once willing to pay for the service but now are shying away. Another factor in prompting CUs to bundle or offer bill pay for free has been banking competition, particularly Bank of America which has been running a national ad campaign promoting the free bill pay service as part of a package of services. [email protected]

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