Taking advantage of a rising sense of community pride and solidarity, black-owned Boston Bank of Commerce will issue a Visa card that contributes to charities for African-Americans.
To show support, several black community leaders, including the Rev. Calvin Butts, Johnnie L. Cochran Jr., David Dinkins, Sharon Pratt Kelly, Queen Latifah, and the Rev. Al Sharpton, have become charter cardholders of the Unity Visa.
The card will donate 1% of every dollar charged to one of seven charity groups: Children's Defense Fund, the Jackie Robinson Foundation, the NAACP Legal Defense Fund, the National Urban League, the Thurgood Marshall Scholarship Fund, the United Negro College Fund, and the Unity Foundation, a nonprofit organization established by the Boston bank to contribute to grass-roots organizations.
Cardholders designate the charity they wish to support each year.
The no-fee card carries a 9.95% introductory interest rate that rises after six months to 7.2% over prime. The Unity Visa will be launched in January, but the $75 million-asset community bank is already accepting applications.
The card will be marketed through direct mail, telemarketing, print advertising, and "take one" displays.
The timing is right for the launch, said Terry Williams, senior vice president of sales and marketing for the bank.
Citing the Million Man March in Washington, and the threat that affirmative action programs might be dismantled by Congress, she said black Americans "need to figure out ways to help ourselves. It's very much a part of how African-Americans have come to view their future mission."
Fran Dale, president of Reston, Va.-based Entandem, an industry consulting firm, agreed that the Unity card "could pick up on that theme."
She noted that marketers are looking toward opportunities in ethnic markets in 1996 and "tapping into community pride."
Ms. Williams, who with her husband, bank chairman Kevin Cohee, is the largest shareholder, pointed out that Unity is the first card issued nationally by a black-owned institution.
A veteran of American Express, Ms. Williams said the bank hopes to attract one million cardholders eventually. She said she expects tens of thousands in 1996.
"I think it's a great idea," said K. Shelley Porges, a San Francisco- based marketing specialist. She said black Americans represent an underserved market.
Ms. Porges cited information from Market Segment Research Inc., which found that about 30% of black Americans have credit cards, compared with 75% overall.
In the African-American community, she said, among the noncardholder population, 55% are employed, 54% have incomes of $15,000 or more, and 74% finished high school or have higher education. "This indicates that a reasonable size of the noncardholder population should be able to qualify" for a credit card.
The bank will initially issue a standard Visa card, and will add a secured card in mid-1996 and a gold card in 1997.
Ms. Porges believes the secured card could give the bank the ability to reach its million cardholder goal.
The Unity card will be one of a handful of African-American affinity cards. Key Federal Savings Bank, a secured card specialist, has targeted the African-American community with a Black Expo U.S.A. card, the American Black Colleges card, and a card issued with the Church of God in Christ, a Pentecostal church whose members are primarily black.
People's Bank of Connecticut briefly issued a Black United Fund affinity card on a regional basis, but pulled back on marketing in order to expand to a national offering, to be introduced in 1996.
Ms. Williams said the card, in addition to harnessing the spending power of the community, which she estimates at more than $200 billion annually, will fulfill black Americans' "desire to give something back. That's one chord this card will strike."