A white paper published by Card Services for Credit Unionsreported that only 50% of credit unions have loyalty or rewardsprograms attached to their credit or debit cards.

CSCU is the association of credit unions which which processtheir card transactions with FIS and actively promotes FIS' rewardsprogram called ScoreCard, but Bill Lehman, FIS vice president forportfolio consulting, said the white paper was directed moregenerally at the topic of loyalty rewards and argues that too manycredit unions still do not use them.

“The point of the white paper it to ask credit unions if theyare active in this space and, if they are not, tell them they needto become active now,” Lehman explained.

Having a rewards program attached to at least a credit cardprogram is a key way a credit union can protect its card portfoliofrom having cardholders switch to other cards which have rewardsprograms.

“Credit unions must recognize that cardholders are a lot savvierthan they used to be and expect more from their rewards programs,”Lehman wrote in Rewards Programs are Essential For Building(and Retaining) Member Loyalty. “In fact, cardholders are muchquicker than banks and credit unions to understand what they wantfrom their financial institutions. Consumers will change financialinstitutions if they are presented with a rewards program that hasa stronger value proposition that better matches their needs.”