AUSTIN - A new website claims it allows credit unions and small community banks to battle the big boys with their rewards checking products for consumers all over the country.
CheckingFinder.com, backed by BancVue and First FOI, allows consumers to shop online for rewards checking products and open an account in 10 minutes. No large banks are part of the site, it includes only institutions that offer BancVue’s REWARDChecking product and which have chosen to participate.
Currently, 450 financials are included, and less than 30 are credit unions. A “small” set-up and a monthly fee are charged to participants, as well a “minimal” fee for each account closed, explained First ROI CEO John Waupsh, who did not disclose the figures related to either cost.
“Think about the reach of the Wells Fargo’s and Wachovia’s,” said Waupsh, who expects credit union presence on the site to expand this year. “We are trying to provide that same type of reach for community financial institutions. The megabanks have 70% of the deposits in the country. We want to deliver tools and services the smaller financials need to reclaim checking market share: secure online account opening and a national advertising platform.”
When consumers use CheckingFinder, they enter their ZIP code and the site brings up a list of community banks and credit unions whose accounts are available to them. Consumers can sort by rate or estimated rate of return. Financials have the option to market their accounts nationally, regionally, by state or ZIP code.
CheckingFinder discloses to consumers the requirements to open each account, such as direct deposit. When consumers choose a product, account opening takes 10 minutes, Waupsh said; the account opening functionality uses a platform hosted by Andera. “Users open an application that asks for driver’s license information, a previous home address, and other out-of-wallet questions to confirm identity.”
The system also performs an OFAC check and runs a report on the user’s banking history in order to qualify the applicant. If the consumer fails to meet credit requirements established by the financial, the app is rejected. If the account is opened, the initial deposit is routed from the user’s current financial institution.
Waupsh believes that online account opening is the key to helping smaller banks and credit unions take on the large banks in what is heating up to be a growing battle for consumers’ checking business.
“Credit unions and community banks have been behind the times with online account opening,” Waupsh said. “Of the 350 institutions BancVue had last November, fewer than 10 had online account opening procedures. The market wants online account opening, especially Gen X and Gen Y.”
Of the CUs participating in CheckingFinder today, all have community charters, Waupsh said. Field of membership requirements are tied to the zip code sort. “So if a consumer calls up a zip code in which a credit union’s field of membership does not apply, the credit union will not show up in the sort.”
If a consumer selects a credit union product, a details page describes field of membership requirements. That will help when CheckingFinder brings in CUs that are not community based, which Waupsh expects will happen this year. “And before the account funds, a credit union employee has the ability to review the application to make sure the person is eligible to become a member.”
Consumers have begun hearing about CheckingFinder through syndicated TV and radio financial talk show host Dave Ramsey, CheckingFinder’s spokesperson. The site is also advertised through other national websites, explained BancVue CEO Gabriel Krajicek, who said promotion will pick up later this year after it’s determined which marketing approaches carry the greatest impact. Plans are in place to promote the site through the blogging community, as well.
Krajicek explained advertising will focus on “the power of the community bank and credit union and their importance to their communities.” And it will be clear that CheckingFinder does not include a big bank. “Our largest customer is $8 billion in assets, and I can’t ever see us getting any institution bigger than that.” Krajicek added that CheckingFinder is seeking to expand into iTunes rewards, rewards savings, and a program that would allow consumers to direct rewards to charity.
BancVue’s REWARDChecking product is free and requires no minimum balance, waives ATM fees, and carries higher interest rates, many now in the 4.5% range with some as high as 6%, Krajicek said. Product pricing and features vary by financial institution, as do requirements for consumers to get higher rates, such as direct deposit, debit card usage, or e-statements.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com http://www.sourcemedia.com
