JOSH MCAFEE UNDERSTANDS how to tap millennials with compelling reasons to join a credit union. That’s because the 26-year-old vice president of marketing at Leaders Credit Union in Jackson, Tenn., knows the demographic first-hand.
So, he set about building the Launchpad program, a suite of credit union services designed to cater to young adults’ needs.
“Some credit unions try to appeal to kids with youth accounts, but who do you really want to attract? Five-year-olds and 10-year-olds, or people just entering their financial lives?” he asks.
Surveys and focus groups indicated young adults perceived barriers to credit union membership, according to McAfee. They saw credit unions as stodgy, appealing to those in their 50s, and less relevant to their needs.
They also wanted higher-yielding savings and easier access to auto loans. McAfee took those observations and collaborated with Northern Federal Credit Union in Watertown, N.Y., to assemble a portfolio of products tailored to millennials.
The Launchpad program, which rolled out in January, includes a savings account that pays 5% interest on the first $500.
It also has free checking and an auto loan program that offers single-digit interest rates on principal amounts between $5,000 and $25,000 for college and high-school graduates who can prove employment. The loans, with terms up to 72 months, require no co-signer.
“Credit unions often are willing to lend to people with a 580 credit score, but often we’re not willing to underwrite loans for people who don’t have credit histories, as is often the case with millennials,” McAfee says. “Launchpad is aimed at addressing their needs and providing an opportunity for them to prove they’re creditworthy.”
The credit union promotes the program on a microsite designed to appeal to a younger audience, in part by delivering financial guidance in a different way.
“They might not want you in their face with sales pitches, but they’re used to sitting in a classroom,” McAfee says.
“They also told us, ‘When it comes to financial advice, don’t text us. I want to talk face-to-face.’ Credit unions were made for that.”
McAfee has evangelized for the credit union’s mobile application and for social media advertising and promotion.
And he has worked to strengthen community connections. Five educators formed Leaders in the 1950s by each putting $5 in a cigar box, but over the years the credit union lost touch with the Jackson school employees whom it traditionally served.
In 2012, Leaders offered the school system $100,000 to exclusively sponsor the district’s in-service trainings for 10 years. The credit union staffs a booth at the in-service sessions.
“People met us up close, shook our hands, and we started building trust,” McAfee says. “I thought it would have been big in 2012 and then drop off, but our impact has increased every year, because I don’t think people thought we’d carry through and maintain that presence.”