TAMPA, Fla.–Credit unions should act now to breathe new life into and build additional revenues from their card portfolios during 2021. Not only are their proven strategies for doing so, but other competing card issuers will be acting, CUs were told during a webinar hosted by Trellance.
Ann Farrell, who leads Card Portfolio Growth Solutions at Trellance, said the company has made significant investments in data analytics since its launch in 2015 of the growth solutions program.
As the chart at right shows, Farrell said credit unions that have been part of the Card Portfolio Growth Solutions have seen significant and steady growth in their card programs.
“We know the competition is out there and we want to make sure you are able to combat it with campaigns on a quarterly basis,” Farrell said.
During the webinar, Farrell outlined three programs Trellance offers the 1,500 CUs that partner with the CUSO to issue cards: Credit Line Increase Program; New Accounts Acquisition Program, and the Targeted Usage Program.
“If you are not providing credit line increase programs on a yearly basis, you are missing out on a huge opportunity,” said Farrell. “If you are not putting cards in the hands of your uncarded members, you are missing a huge opportunity.”
Credit Line Increase
Farrell said the Credit Union Increase Program (CLIP) is an instrumental tool for keeping a CU’s card on top of wallet in addition to increasing credit utilization loans outstanding, and interest and fee income.
Farrell said Trellance has found approximately 60% of member card accounts quality for an increase. “If you haven’t run a credit line increase in a few years, this percentage can be higher,” said Farrell.
Farrell, who reminded CUs “your competition is knocking on your members’ doors,” said if credit line increases aren’t provided to members the portfolio “really stays stagnant.”
“The process starts with cardholder data,” said Farrell. “We work to analyze your data with proven criteria as a baseline. We set a proposed new limit to each qualified cardholder. Credit unions have the final say.”
Farrell added Trellance’s program will handle all compliance, including ability to repay rules.
New Accounts Acquisition
The Trellance New Accounts Acquisition program simplified prequalification offers, according to Farrell, as it is data driven and focuses on electronic new account acquisition. “This program provides an offline to online experience, allowing the FI to compete with the big guys,” she said.
Under the program the member/non-member receives an offer in the mail, with the prospect then goes online to complete offer details.
“We look at your parameters and historic data with each prospect before pre-qualification,” said Farrell, noting the program does not waste time on households that aren’t going to be receptive. The Trellance system tracks both complete and incomplete submissions.
Participants have seen an average of 1.3% response rate even during the pandemic, according to Farrell.
Targeted Usage Program
The Targeted Usage Program, which Trellance calls Awarded Right, works automatically to identify and isolate an inactive account segment. “We then notify your cardholder and encourage them to change their habits through an awarded cash incentive,” explained Farrell.
In this case, the cardholder is urged to spend $500 on the CU card within 60 days, and the program is designed to keep the member spending on the card beyond just collecting the award on everything from the “first coffee in the morning to monthly payments,” said Farrell.
“It’s really about changing that behavior of your members on an ongoing basis throughout the year,” she said. “At the end of the promotion you will know who didn’t actively participate, so you might want to look at your reissue churn so you aren’t paying for that. We have the data to look at transactions to make sure people have spent the $500.”
Other Programs
Farrell said Trellance also has other marketing promotions available, including two each for balance transfer promotions, usage campaigns and employee incentive campaigns.
Farrell, who stressed the programs are priced on a “pay for performance model,” said she knows “our programs work. “The kick-starters plus the marketing kits plus our dedicated portfolio growth team all equals your growth,” she said. “Take a look at your metrics. Find out what your year-over-year growth is. You really have the potential to grow your cards. What do you have to lose?”
For credit unions looking to leverage a Trellance card program in 2021, Farrell said Sept. 30 is the deadline for getting a program in the works.
Sept. 30 is the deadline for 2021 campaigns.