Allowing members in good standing to skip a loan payment duringthe holiday season can provide them with an extra financial cushionto help cover their expenses. Some CUs have found that combiningsuch a program with a charity fundraiser benefits the greatercommunity as well.

For example, Chantilly, Va.-based Justice Federal Credit Union'srecent skip-a-payment program gave members the option to skip theirqualified loan payments for November or December, and 25% of the$30 skip-a-payment fee was donated to the National Center forMissing and Exploited Children. In this way, the 2,395 members whoparticipated raised $17,962 for the charity.

“The idea [for the program] came back in 2004 as a way to infusevalue to the membership at a time when it is needed most,”explained Joan Marsh, vice president of retail delivery systems forthe $512 million credit union. “The donation piece was something wethought would resonate with the membership.”

The NCMEC, a nonprofit organization whose mission is to serve asthe nation's resource on the issues of missing and sexuallyexploited children, works in cooperation with the U.S. Departmentof Justice. That makes it a good fit for the 50,000-member creditunion, which provides financial services to employees of theDepartment of Justice and other law enforcement communities.

Justice FCU spread the word about skip-a-payment with a directmailing to members, Marsh said. Credit cards and consumer loanswere eligible to be skipped. With such programs, interest continuesto accrue on the loan and the repayment schedule is extended. Theimpact of skip-a-payment on Justice FCU's income is minimal, Marshsaid, when overhead and expenses for the campaign are considered.The credit union intends to repeat the program next year, sheadded, and may look to provide funds to a different charity.

A popular beneficiary of skip-a-payment programs is CreditUnions for Kids, the brand under which credit unions across thecountry fundraise for Children's Miracle Network Hospitals. In theKansas City area, donations from CUs and their members go towardhospitals such as the Kansas University Medical Center. KUMC, saidIle Haggins, director of Children's Miracle Network of GreaterKansas City, is using the funds for the building expansion of a $20million pediatric outpatient center. The funds will also supportthe hospital's cancer research and treatment.

“Children's Miracle Network Hospitals is so fortunate to be thebeneficiary of the credit union community through the Credit Unionsfor Kids program,” said Aubrey Cichelli, vice president ofcommunications for the charity. “We love to see campaigns [such asskip-a-payment] that offer members an incentive that inspires themto participate, which ultimately benefits the children in theircommunity.”

Annette Vukas, a member of the $263 million Mainstreet CreditUnion of Lenexa, Kan., said she felt moved to go beyond the $10donation to Children's Miracle Network Hospitals suggested by thecredit union in conjunction with its annual skip-a-payment program.Vukas decided to contribute $50 for each of the three loans onwhich the CU allowed her to skip a payment. “I thought, if they'resaving me money I could do a little bit more than $10,” shesaid.

The credit union emphasized that it does not charge a fee toskip a payment and that the charitable donation is voluntary,adding that more than 75% of the members who participated in itsskip-a-payment program from November 2010 through January 2011chose to give to Children's Miracle Network Hospitals.

Mainstreet CU, said Dawn Smith, vice president of riskmanagement, has offered members the opportunity to skip a loanpayment for more than 20 years. After discussing feasibility withregulators in 2002, it added the option of donating to the charityin 2004.

The credit union now has about 57,000 members, 1,156 of whomparticipated in the skip-a-payment program for the 2010-2011period. The $17,249 they donated set a new record for Mainstreet,topping the $16,459 raised in 2007, CEO John Beverlin said. Thecredit union, he added, has contributed an additional $55,440 toChildren's Miracle Network Hospitals by matching a portion of themembers' donations.

“Our members have come to expect this promotion and startcalling in October to request their skip-a-payment,” Smith said.Also in October, she added, the credit union sends a memo to itsmember contact staff reminding them that the program starts on thefirst of November and outlining the steps required to process theskip-a-payment requests. Mainstreet markets the promotion, whichexcludes home equity loans and first-
mortgage loans, in statement stuffers, its newsletter and itswebsite.

Frontier Community Credit Union of Leavenworth is another KansasCU whose annual skip-a-payment program benefits Children's MiracleNetwork Hospitals, but it is structured slightly differently.Rather than a suggested $10 donation, there is a $10 fee for eachloan that a member wishes to skip a payment on, and 100% of the feeis donated to the charity. For the 2010-2011 period, 1,346 membersparticipated, resulting in a $13,463 donation. The credit union hasbeen doing the program since 1998, and it has raised a total of$124,858 for charity.

Adrianne Cianciolo, marketing consultant for Frontier, explainedthat the program's genesis was inspired by the success of similarcampaigns at other credit unions.

“Several Frontier Community Credit Union (then Fort LeavenworthCredit Union) staff and volunteers were familiar with theskip-a-payment program through involvement and experience withother credit unions, and had been impressed with how well itbenefited both members and an extremely worthy charity,” she said.“The credit union was in the process of implementing a newmarketing strategy in 1998 and the skip-a-
payment program was a perfect fit for that strategy.”

She also explained why the chosen charity appealed to the creditunion. “The Children's Miracle Network emphasizes community,keeping charitable contributions local; that focus fits very wellwith Frontier Community Credit Union's charter of service-not onlyto our members but to our greater Leavenworth community andsurrounding counties' population as a whole.”