Even though affinity card issuing may have a become a more difficult regulatory and economic challenge, some credit unions have begun to find payments success by launching affinity card rewards programs, credit union card executives report.

Just as affinity card issuing allows banks and some credit unions to issue cards in conjunction with a local group or association and market the cards based on that association, affinity card rewards enable credit unions to offer reward point redemption options that are tied to a given locale or community. Or they allow cardholders to use their points and generate points to help a local charity or other nonprofit. Each functions, the executives explained, as a way of personalizing and characterizing a financial product that could be seen as a financial commodity, a card much like any other financial institutions' card, and make it more appealing to members.

Credit unions using the programs say they significantly increase usage and interchange income from both debit and credit card portfolios as well as often carry a lower cost of rewards because area merchants will frequently fund at least part of the effort.