Whatcom Educational: Youth Can Debit

Whatcom Educational CU has a unique strategy that teaches youth about debit cards.


Starting high school age members with a debit card can be an effective strategy in cultivating financially literate citizens. Several credit unions are teaching their youth about building a good credit score and later transitioning them to a low limit credit card with proper account monitoring.

Since most young people use only one financial institution, credit unions are able to offer youth awareness and education strategies that coach teenagers about proper card management.

Youth Debit Education Strategy

Whatcom Educational Credit Union (Bellingham, WA, $368m) offers debit cards to its high school youth and even has an eight-year-old with an account. The youth program is actually a Student Visa Credit Card program, but Whatcom Educational starts most of the students with a debit card.

"For a lot of our youth membership, the debit card serves as the learning period before they apply for a credit card," said Kelly Nuessen, card services manager at Whatcom Educational.

Since 2001 Whatcom Educational has provided value to the community by hosting a youth education class for 16- and 17-year-olds. Managers at the credit union lead a 90-minute class every other month and parents are encouraged to attend. They teach about how the debit card works, billing cycles, cash advances and how to create and maintain a good credit rating.

Students who attend the debit card class can receive a Visa credit card with a $250 limit that is good until they turn 18. This card does not require an adult co-sign. "We are taking the business risk to work with this age group," said Nuessen.

If the youth are late on their payments more than twice, staff will work individually with these students to get them back on the right track. Once the youth turn 18, they can apply for a $500 limit. There have been no losses since the class started due to the credit union's focus on this segment of their membership.

Reaping the Benefits

There have been mutual benefits for Whatcom Education and the members. The debit card usage generates interchange income for the credit union. Discussing the card's attributes with youth increases their parents' awareness of the program as well. "It's been really fun," said Nuessen.

The hope is that by making their youth members comfortable with their products, the credit union will become the primary financial institution for the entire family. The youth educational focus is one facet of their growth strategy. Whatcom Educational grew its membership 6.1% in the last 12 months, which is more than double the industry's average of 2.3%.




June 6, 2005


  • I'm a bit confused. It's a debit class in which the youth receives a credit card before they can be liable for the debt? (under age 18) Is that right?
  • Although we have a pre-teen and a separate youth/young adult account program, we have always struggled with the legal age consideration and only lowered our tolerance to age 17 for debit cards and credit cards to catch the senior before they leave their parents' home and guidance possibilities. In many ways, this is too late or at least exposes us to greater chance of not getting the young adults' attention before they leave their nest for college or the real world, where every credit card company and bank is offering these young adults credit cards without their parents.
  • The WECU youth program is actually a Student Visa Credit Card program, but most of our students started off with a debit card. The debit card can be a usefull and beneficial tool to teach first time card users the use of a card with actual available amounts in their checking accounts before working with them on the Student Visa Credit Card.