CUs Gear Up for Bank Transfer Day

Banks’ debit fee misstep drives thousands of consumers to CUs.

November 4, 2011

Many of the nation’s credit unions are gearing up for Bank Transfer Day (Nov. 5) by offering bonuses for member referrals, promoting the credit union difference via social media, holding festivities, offering prizes, and taking other measures.

Based on a survey of 5,000 credit unions nationwide, CUNA estimates at least 650,000 consumers have joined credit unions since Sept. 29—the day Bank of America unveiled its now-rescinded $5 monthly debit card fee.

Countering large banks’ recent debit card fees, Mission Federal Credit Union in San Diego is rewarding members for using its debit card, paying members 25 cents each time they use the credit union’s debit card up to $5 during November and December.

“Mission Federal does not charge a monthly fee for debit card usage,” says Debra Schwartz, Mission Federals president/CEO. “With debit card fees top-of-mind right now, we intend to instead reward our customers up to $5 per month through year-end for using our debit cards, and invite others to experience the Mission Fed difference.”

As an additional bonus (part of its 50th anniversary), Mission Fed members can also refer a friend to open an account. Both will receive $50 if they meet certain program requirements.

The credit union also has formed a Kindness Crew to carry out “50 acts of kindness” at schools and nonprofit organizations throughout San Diego County to inspire others to do the same.

Special hours

In Redding, Calif., Members 1st Credit Union will offer special Saturday hours at one of its branches to coincide with Bank Transfer Day. It will welcome new members frustrated with large banks’ exorbitant fees for debit cards and other products, and highlight the credit union’s affordable offerings.

“Our basic checking account has no monthly fees, no debit card fees, and no minimum balances to maintain,” says Nicki Crandall, Members 1st AVP/area manager. “We’ve seen an increase of new members over the past couple weeks as people are bringing their business to us because of our fee-free account.”

Saturday’s festivities will include prizes for new members and free food. The credit union’s switch kit will allow new members to sign up for accounts in just a few minutes, and credit union staff will help new members transfer all automatic deposits and withdrawals from their old accounts to their new Members 1st accounts.

Always Bank Transfer Day

 Cash-back debit

The University of Illinois Employees Credit Union (UIECU) introduced CardCash® for debit cardholders, a 1% cash-back reward program on non-PIN debit card purchases.

UIECU debit card users may earn up to $250 per year in cash back for their everyday purchases—a distinct advantage for consumers when many large financial institutions are shutting down their debit card rewards programs and even charging monthly fees for debit cards.

“Many reward programs at other institutions are being eliminated, even while fees are being increased,” says Greg Anderson, UIECU senior vice president. “We are proud to be able to say that is not the case at the credit union. We’re adding services and products that have value to our members, without charging them for the privilege.”

CardCash benefits include:

  • 1% cash-back rewards on all qualifying non-PIN debit purchases with a yearly cash-back earning potential of $250;
  • Monthly e-statements communicating accrued cash back and detailed evaluation on qualified and unqualified purchases;
  • CardCash® Bonus Alert emails that provide tips and tricks for optimizing earning opportunities; and
  • Automatic deposit of cash-back earnings to their checking account—no need for redemption.

 Next: The switch is on

CUs pledge fair prices

In Minnesota, 83 credit unions have pledged to continue offering fairly priced banking services, including debit card fees, in the wake of major banks’ decision to increase debit card fees (and their subsequent reversal).

This declaration is an extension of credit unions’ mission to put the needs of individuals above making a profit. A list of credit unions that signed the pledge is available online. It states:

“I pledge to uphold the credit union philosophy of ‘people helping people’ by continuing to offer fairly-priced banking services to our members. In addition, I pledge that my credit union will abstain from charging a fee for members to use our debit cards for as long as market conditions allow us to do so.”

CUNA estimates that, over the last year (12 months ending June 2011), the average Minnesota credit union member saved $76 ($144 per household) by using a credit union instead of a bank. That’s just an average—the more business members do with credit unions, the more they save.

“Our cooperative structure is unique among financial institutions,” says Mark Cummins, president/CEO of the Minnesota Credit Union Network. “While other financial institutions exist to maximize profits for their shareholders, credit unions exist to maximize their service to members. This unique business model is causing many consumers to consider joining their local credit union.”

The switch is on

Michigan Schools and Government Credit Union, Clinton, Township, Mich., will provide switch kits for frustrated bank customers at any of its nine branches.

Eligible members can visit one of its branches between 9 a.m. and 1 p.m. to set up new accounts. Plus, the credit union will offer a new-member bonus by matching deposits up to $25 for members who open checking accounts.

Members will also display their name on a wall of new members who’ve walked away from their banks.

“Bank Transfer Day is an opportunity for people to start setting it right by taking back control of their own money,” says Peter Gates, CEO of Michigan Schools and Government Credit Union. “We’re hoping that this day allows people to discover that credit unions are a better alternative to profit-driven banks.

“People are tired of fees,” he continues. “Times are tough enough, and people should not have to pay unfair banking fees that can cost an upwards of $25 a month at some big banks.”

Members can also download an online switch kit to make the transition from bank to credit union.

What's the difference?

Watch Teresa Halleck, president/CEO at San Diego County Credit Union, explain the difference between banks and CUs: