On the morning of August 16, Money One Federal Credit Union ($105.4M, Largo, MD) gave away $4,000 worth of gas ̶ $20 each to the first 200 motorists at a Shell station in Greenbelt, MD. Word had spread quickly through radio and television ads and motorists started lining up at 6:30 a.m. that day. Police were on site to keep order.
But the morning sped by with little incident after the gas promotion opened at 9 a.m. Everyone in line received a number and the free gas was gone by 10:35 a.m. By the time president and CEO Debbie Connors returned to the Money One FCU branch in nearby Berwin Heights, three new members had joined and a fourth was waiting to sign on.
“We want them to take back their banking,” Connors says of the promotion’s goal. “We feel the consumers are very frustrated by their relationships with the big megabanks. We want the consumers to have all of the perks without the sacrifices.”
As gas prices reach record levels this Labor Day, credit unions across the country are using gas promotions to drum up business. Money One FCU’s gas giveaway promotion was part of a two-day, nationwide effort by more than 200 credit unions in 20 cities that pool their marketing dollars for more buying power. Each credit union offers free Kasasa checking accounts with either large interest returns or rewards for iTunes or Amazon through an Austin, TX,-based company called BancVue, which caters to smaller financial institutions.
Money One FCU sets the pricing for its two Kasasa checking accounts. The first, called Kasasa Tunes, is geared to Gen Y with up to $10 per month refunds for music downloads and requires at least 10 debit or credit transactions. The second, called Kasasa Cash, offers account holders a 3.01% return and requires members to have direct deposit. Both account options require members enroll to in eStatements.
The credit union first started offering rewards checking accounts in February 2011. In the past 18 months, it has seen substantial increases in the number of consumer checking accounts – to more than 5,300 accounts. In the second quarter, Money One reported a 2.8% 12-month share growth. The goal this year is to open 900 new checking accounts.
“Prior to offering these accounts, we could never get our checking accounts over 4,800,” Connors says. “We’ve had 500 new accounts. For an institution our size, that’s a huge increase.” BancVue conducts monthly analysis of Money One’s checking accounts, so the credit union knows what it’s costing and what it means to the bottom line.
Since it began pooling its marketing dollars, Money One has also noted significant increases in its auto loans. Its overall 12-month-loan growth was up 7.21% in the second quarter, according to Callahan and Associates’ Peer-to-Peer data. Its auto loan growth was 20.1% year-over-year, up from 7.5% the same quarter last year.
To further promote its rewards accounts and the credit union message, Money One also hosted giveaways at Rita’s Italian Ice – giving away $5 each to the first 300 customers – and at Silver Diner – giving away $10 vouchers to the first 300 customers. In October, it is hosting a community shred day to help residents destroy confidential information.
“People are not aware of all that credit unions can do and that we can offer accounts that are just as good, if not better, than what these megabanks are doing,” Connors says. “So we wanted to do something to get their attention to let them know they have the choice. … It was definitely worth the investment. ”