The 8,000-member, $70 million TECU Credit Union has discovered that launching a new credit card has revitalized its card program and refreshed it community image.
The Wichita, Kan.-based credit union, with roots in the communications industry, had been looking for a way to energize its credit card program for some time and had also been searching for ways to implement some changes to the credit union's identity, according to CU executives. In particular TECU wanted to attract more younger members to the credit union but do it in a way that didn't alienate the credit union's older members.
With the help of analysts from Card Services for Credit Unions, the association of credit unions which process payments with FIS, TECU decided to reissue its Visa card program with a rewards program that would both attract younger area residents as well as please older credit union members, the executives said.
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TECU dubbed the reissued card The Care Card and executives reported that it has been a relatively speedy success.
"We knew that the younger generation often made financial decisions based not just on value but also on their ideals," explained TECU CEO Chuck Bullock. "They are looking for the authentic and we sought to offer a card that would harness some of those instincts."
The Care Card differs from a general purpose rewards card in that it allows the cardholder to translate rewards points into cash for donations to a given national or local charity of the cardholders choice. The program uses the ScoreCard rewards program and its Charity Choice website as the foundation for the program.
"We realized our Generation Y members are passionate about giving back to their communities, which aligns well with credit unions' purpose, and so the idea of The Care Card just made sense," said Kelly Martin, assistant vice president of operations. "Our goals were to entice our current cardholders to use the card as well as capture the Generation Y audience and make The Care Card top of wallet for them."
TECU also cut the interest rates on the new card, which helped make it more attractive to existing members as well, the executives said.
Since offering The Care Card, TECU has more than doubled new credit card accounts year over year, and grown total outstanding balances by almost 18%, which includes a net sales volume increase of 17.7% leading to increased interchange revenue for TECU.
Since offering The Care Card, TECU has more than doubled new credit card accounts year over year, and grown total outstanding balances by almost 18%, which includes a net sales volume increase of 17.7% leading to increased interchange revenue for TECU.
As of the end of March of this year, TECU had 688 card accounts worth roughly $1.45 billion in outstanding balances.
"It used to be very unusual for us to see more than one or two new card accounts per months, so having that kind of jump has been extraordinary," said Martin, who acknowledged that the increase in card popularity has increased her workload as well. Martin is effectively TECU's card manager.
Bullock reported that member response to the card offering has been very strong and that, in an indirect way, it has helped TECU reinforce its new brand emphasis in the community and helped members see the credit union as not just a place seeking to serve its own members but the whole community. "It has helped solidify our overall message about the credit union," he explained.
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