LYNCHBURG, Tenn. — Adding a debit card to its product mix has helped one $13-million CU grow by $2 million in assets over the last two years.
Jack Daniels Employees FCU added the card just over five years ago, and today close to half of its 1,300 members use its debit card. CEO Pam Case said the move has helped position the credit union-despite its size-as its members' primary financial institution, which has resulted in members taking more services. "Over the last five years, adding our debit card program has been one of the key factors in us doing so well," said Case, whose CU also fared well in the latest Callahan rankings. Jack Daniels was ranked No. 1 in Total Return of the Member for credit unions with assets from $10 to $20 million.
The card, set up through the Illinois League and processed by CSCU's Fidelity Card Services, makes members think of the CU more often when they do business every day, according to Case. "When they buy their groceries they think of us, which helps when they go to make larger purchases, like a car-they think of us first."
When the CU introduced the card it made sure it had an effective cross-sales strategy in place. It moved away from having teller lines dedicated to transactions, and now has member service stations staffed by employees cross-trained to perform many services.
To boost cross sales, the CU introduced an auto loan incentive that gives members a .25% rate reduction (up to 1%) each time they take checking account, another loan product, direct deposit, or a mortgage. The approach has helped increase JDEFCU's loan-to-share ratio to 78%. At press time auto loans for all terms started at 5.75% APR for the best paper. A five-year adjustable rate mortgage was 6% APR. Jack Daniels also pays above market on deposits, Case said. A six-month CD returned 2.25% APY and a one-year certificate paid 2.5% APY.
The credit union can offer the competitive loan and deposit products by keeping costs under control. Until last year, when the CU moved to a larger location, it had been running operations with three employees. Today it has five, still giving the CU a 260-to-1 member-to-employee ratio.
Having a lean staff does not sacrifice service, Case said. "We work extremely hard when members walk in the door to treat every one the same. We always try to answer any questions they have and be available to them in any way we can. We have really good rapport with members and they know they can trust us. To be honest, they are our best advertisers."
