ST. PAUL, Minn. (2/26/15)--Prize-linked savings (PLS) accounts may soon spread into Minnesota, as two bills sponsored by the Minnesota Credit Union Network (MnCUN) allowing credit unions to offer such accounts were introduced in both the Minnesota House and Senate this week.
With massive support from leagues and CUNA, a number of states across the country have passed legislation permitting credit unions to offer PLS accounts.
The accounts, designed to encourage savings, work by offering members entries into cash-prize drawings each time they deposit a set amount of money into a savings account.
There's no risk on behalf of the member, as those who lose out on the cash prizes still win in the form of healthy savings accounts.
"MnCUN worked diligently to get these bills introduced," said Mara Humphrey, vice president of governmental affairs. Humphrey also thanked the state lawmakers who authored the bills in the Legislature: Sen. Vicki Jensen (D-Owatonna) and Rep. Jennifer Loon (R-Eden Prairie).
PLS accounts so far have been approved in 10 states, including Connecticut, Indiana, Maine, Maryland, Michigan, Nebraska, New York, North Carolina, Rhode Island and Washington. A bill allowing PLS accounts in Virginia only awaits the governor's signature.
Since 2009, credit unions offering PLS accounts have helped more than 50,000 members save $94 million.