Centra CU Pilots Incentive-Based Savings
COLUMBUS, Ind. – Centra CU introduced a new concept in savings yesterday–a prize-based savings account. The $600 million credit union is believed to be the first financial institution in the country to offer financial rewards in exchange for savings. Participants in the credit union’s ‘Super Savings’ program are eligible for 10 different monthly drawings offering prizes of up to $1,000 each month. In exchange for the opportunity to win prizes, the accounts pay a lower rate of interest than the credit union’s regular share (savings) account. The Super Savings account pay 0.50%, while the regular share accounts pay 1.4%. “This is something we believe that will appeal to small savers,” said Nancy Morrow, vice president of corporate development for Centra CU, who got the idea from the Filene Research Institute’s i3 Group on innovations.”We’ve test-marketed this at two branches for two months and rolled it out at all of its 20 branches two weeks ago,” Morrow, who was named to the i3 Group in November, told The Credit Union Journal yesterday. So far the innovation has shown promise. More than 300 accounts were opened during the two-month test in the branches. The average balance on the accounts is small, about $185. In addition to the monthly drawings for $1,000 of prizes, the credit union will stage a quarterly drawing that will award the winner a prize that doubles their savings, up to $1,000. A grand prize valued at $5,000 will be awarded for the year.