Big Returns on High-Yield Checking

Connexus CU enrolled more than one-third of its members.

July 23, 2013

While many financial institutions shy away from high-yield checking accounts, Connexus Credit Union in Wausau, Wis., sponsors not just one program, but two.

More than one-third of the $459 million asset credit union’s members with checking accounts are enrolled in the MyRewards and Xtraordinary programs, which have proven a differentiator in the marketplace among those who regularly use debit cards and are comfortable with electronic transactions.

Both programs offer interest rates higher than those on short-term share certificates—1.35% annually for MyRewards, 1.75% for Xtraordinary— for the first $25,000, and 0.31% for excess assets, with no minimum balance.

Connexus off sets the programs’ costs through higher volumes of interchange fees and less demand for branch services.

MyRewards requires e-statement participation, as well as one automated clearinghouse (ACH) and 10 nonpersonal identification number (PIN) debit transactions each month.

Xtraordinary requires an additional third-party bill pay debit and five more non-PIN debit transactions every month.

Members who don’t meet those requirements receive 0.25% annual percentage yield (APY), which remains well above the 0.05% national average for an interest-bearing checking account, according to’s May 2013 survey.

According to the 2013-2014 CUNA Fees Report, 58% of credit unions offer some form of interest-bearing checking account.

“We’re really involved with give-back to our members,” Connexus President/CEO J. David Christenson says. “We’re not a credit union that gives annual bonus dividends. Our philosophy is one of paying out the money all the time to our members.”

MyRewards checking constitutes 23.7% of all Connexus checking accounts. Participation has tripled since its introduction in 2007, and balances have increased 144%.

Xtraordinary checking, which represents 14.1% of the credit union’s accounts, has grown 49% in number of accounts and 63% in balances since its 2009 introduction.

The high-yield checking programs aren’t designed as a certificate replacement, Christenson says—just a way to maximize return on members’ liquid assets. And while checking is a gateway to other services, Christenson values the high-yield strategy more as a retention device.

“We’re not a fad credit union. If we do something, we want to stay with it,” Christenson says. “We are a credit union built on integrity, and while market forces sometimes influence our actions, our goal is to provide our members with consistently strong financial choices."