INDIANAPOLIS-In a year in which analysts emphasize the importance of turning bank converts into profitable members, one CU has introduced a checking account aimed at deepening relationships via rewards.
FORUM Credit Union has introduced YOUR checking, which, in addition to rewards features no monthly fees, no minimum balance, free online banking, and more.
The free, high-interest-bearing product delivers rewards points monthly when members take additional services and reach activity thresholds. Members earn rewards for loan balances, savings balances and the length of their membership. They also have the option to choose how they receive monthly rewards. Points can be redeemed for a higher (1.25% up to $25,000) checking dividend rate, cash, or be banked to offset fees.
"What we are saying with this account is that we want members to be engaged with the credit union," said COO Andy Mattingly. "We are saying we want to show you how different the credit union is and what it means to be involved in a cooperative. We are setting ourselves apart in a tangible manner from other financial institutions. The more you do with us the more you get back from the cooperative."
How Program Works
Each month members get a point for every five years they have had a FORUM checking account, and they get a point as soon as they open the account. One point equals one dollar. Members receive a point for each $5,000 in loan or deposit balances, as well as a point for having more than 20 debit transactions monthly. Members must earn at least four points and complete two or more checking account transactions per month to receive rewards.
Since the account was introduced in November, Mattingly said FORUM has seen monthly point totals range from $3 to $20. "Members can make as much as $240 a year," said Mattingly, who emphasized these type of loyalty rewards are not handed out by big banks. "You won't get this at Chase."
The credit union conducted extensive focus group, member and employee research to determine the type of checking account to offer. Simplicity is a message the CU heard repeatedly. "People want a simple checking account that is easy to understand," said Mattingly, adding that the decision was then made to eliminate FORUM's multiple checking products in favor of YOUR checking. The $930-million credit union still offers its student and second chance checking products.
Allows For Flexibility
Research also showed that consumers want the ability to adjust their current checking account based on life circumstances. Mattingly said YOUR Checking provides a great deal of flexibility in choosing interest rate and rewards. Advertising tells consumers they can "build your own account."
The new product's goal, said Mattingly, is to increase net checking accounts from 51,000 to 57,000 by year's end. "We have had very good response so far, but it's too soon to gauge results. This checking account is just a great tool to cross-sell and add additional relationships. Our goal is to get three active services for every new checking account."
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