DES MOINES, Iowa (10/2/15)--A new white paper from The Members Group (TMG) explores how credit unions can increase the profitability of their credit card programs.
The potential of credit union credit card programs is often underestimated, according to the paper’s author, Jennifer Davis, portfolio management executive for TMG. The paper, “Getting the Most of Your Credit Card Program,” explores how even small tweaks to a credit card portfolio can produce big results.
The paper describes how to understand and monitor key metrics that are essential in achieving growth. Among the key metrics are credit line amount, penetration, losses and attrition.
“With a strategic ear to the ground, cards teams can easily uncover otherwise illusive information and capitalize on the untapped potential of their most lucrative asset,” Davis writes.
In addition to goal metrics, Davis’ paper includes discussion of the five stages of the cardholder lifecycle and strategies for optimizing the consumer experience within each.
The five stages are:
Lastly, Davis tells the story of two credit unions that gained eye-opening insights from credit card portfolio reviews.
“I would recommend every [financial institution] take the opportunity to undergo a performance review,” said Dave Cale, president/CEO of Financial Plus CU, West Des Moines, Iowa. “It’s a valuable process to either confirm you are headed in the right direction or to make adjustments. It has certainly helped us reignite a dormant product, giving us the opportunity to deliver more value to our cardholders and equity to all members.”