By Ray Birch
WAUKEGAN, Ill.—The nation’s “best” online checking account is doing a lot more than driving new accounts–it’s doing what all good checking products should do—building deeper relationships.
Consumers Credit Union’s Free Rewards Checking was recently named Best Online Checking Account by WalletHub. The credit union told CUToday.info that the product is generating higher account balances and greater use of its credit and debit cards, not only in larger transaction numbers but also in higher spend.
Dave Valentine, VP of marketing and sales, said Free Rewards Checking not only encourages top of wallet position for its cards, but top of FI status for consumers, which often becomes the PFI for those using the account, he said.
“Like all credit unions, our goal is to provide the best value to our members,” said Valentine. “And certainly we want to deepen relationships. Members earning the maximum in rewards are those who have that deep account relationship with us. They are using our free e-services, debit card and credit card. The constant interaction with our product creates continual brand engagement.”
4.59% Dividend
The no-fee Free Rewards Checking pays 3.09% APY on balances up to $10,000 if members meet the following monthly requirements: make at least 12 signature debit card purchases per month, choose paperless statements and online bill pay (the bill pay requirement is waived if the member has at least one direct deposit or ACH debit per month), and sign into online or mobile banking once a month.
Consumers will apply a 3.59% rate on balances up to $15,000 if members spend at least $500 per month on their credit card. If members spend at least $1,000 per month, they earn 4.59% on balances up $20,000.
“Our goal is to encourage use of CCU products and services,” said Valentine. “When someone is using their CCU credit card to make $500 or $1,000 in purchases a month, it suggests that our card is their preferred credit card. We want to reward this behavior not only with the benefits of our credit card program, but also by paying a very high yield on their deposits.”
Valentine said the results for the account, introduced in 2014, have exceeded expectations.
“Looking back three years, we’ve seen 45% and 90% growth in checking accounts and balances respectively,” said Valentine. “As of the end of March, more than 47,700 members have our Free Rewards Checking account with more than $282 million on deposit. As we continue adding new checking accounts each month, more than 40% of those members also take our VISA credit card. The growth in our credit card and debit card spend and transactions has grown exponentially during this time period.”
Valentine also credited well-trained employees who educate members on the checking account for the results.
In addition to the pricing, Valentine said members are choosing Free Rewards Checking for the convenience it provides.
“Our Free Rewards Checking is designed to be easily accessible while providing truly exceptional rewards. Many members are earning over $75 a month in dividends while benefiting from the convenience of mobile deposit, free bill pay, text banking, a free online personal finance manager, and more,” said Valentine. “But another differentiator is the ATM fee refunds. Members can use any ATM nationwide, without worrying about the surcharge fee. CCU refunds all ATM fees back to the member each month.”
No Changes Planned
Valentine said that Consumers has no specific plans to adjust the checking account’s pricing.
“However, we continually look for ways to improve the account,” said Valentine. “There is always the possibility of offering even greater rewards to members who utilize more CCU services. Maybe we’ll adjust some of the qualifiers if we feel the adjustment is a win for both our members and overall health of the account.”
Valentine said Consumers created the account not only to compete with traditional financial institutions, but to also ward off upstarts.
“It is definitely a differentiator in the market,” he said. “With growing competition not only from banks, but now fintechs, our Free Rewards Checking sets us apart. We are very proud to be recognized by WalletHub. In a market primarily dominated by large commercial banks, it’s nice that a not-for-profit credit union is providing the best online checking account and offering one of the highest yields nationwide.”