BIRMINGHAM, Ala.-Time for credit unions to take the covers off their checking account "wow factor," while simultaneously also extending their reach.
Together those strategies will attract and keep new members who are joining due to their dissatisfaction with bank fees, insisted Dennis Dollar.
"Credit unions have been talking for some time about developing a wow-factor approach for checking," said the Dollar Associates principal, who noted the checking sizzle could come from adding features like debit rewards or improving pricing. "Some credit unions have been very creative, such as Bethpage FCU with its lifetime (no checking fee) guarantee, or Coastal FCU's one-cent overdraft fee. Whatever the wow factor, it's never been better to make that move with the growth potential from bank customers upset with fees."
Dollar pointed out that the average credit union membership checking penetration is only 42%. "That leaves 58% of the membership to target, a tremendous growth opportunity."
CUs are realizing, too, Dollar said, that they need to expand their reach to provide the convenience necessary to support the checking line. "It would be a different situation if all these new members were just bringing over a CD or taking out loan. But checking is a high-transaction account. So many credit unions are now moving forward with branch expansion plans that were put off during the recession."
Shared branching is gaining a lot more attention, as well, noted Dollar. "Credit unions realize they can't compete with BofA branch for branch."
