DES MOINES, Iowa — Credit unions looking for ways to market the pricing advantages they offer on credit cards may find the banking industry doing it for them by early 2010.
Jeff Russell, VP, strategic development for The Members Group here, an affiliate of the Iowa league that offers card processing services and which has acquired credit union portfolios, believes many cardholders will first wake up to the fact their bank has raised the rates on their credit cards when they start opening up statements at year-end or in the early part of next year.
"You're seeing notices, but not seeing it on your bill yet," observed Russell. "Then you're going to get statements, and bills will go up quite a bit. When that person takes a look at other options, credit unions need to be there — web, direct mail, newsletters. We're going to gain market share one member at time. It will happen — but it will be one member at time."
Russell said he believes credit unions will gain marketshare as the result of consumer "trust. There's a huge opportunity right now for credit unions to gain market share. Consumers are willing to make a change. One by one people are making those individual decisions. People are re-evaluating what card they are going to use as their primary card. More than ever, consumers are looking for financial institutions that have their best interest at heart. Credit unions can market that you can trust them. I think credit unions can always do a better job of marketing. Now is a good time to do it. Credit unions tend to be humble. I think it's a good time for credit unions to be marketing their card program."
Russell projects most CUs will not raise annual fees, given a lack of dependence upon such fees. Ad for any increase in card APRs, he observed, "Every credit union is different. It really depends on what their individual situation is. Evaluate and make decisions on what's best for your institution and for your members."
