Provident Credit Union’s Premium Card with Auto Deposit Cash Back Rewards is Big Hit with Members
St. Petersburg, Fla. – (July 25, 2016) – Although it has been less than one year since Provident Credit Union (Redwood City, Calif.) launched its Visa Signature credit card program, the $2.2 billion credit union has seen the number of applications it processes per month grow from 130 to 700, an increase of over 400 percent. The credit union attributes the surge in interest to several unique features of the premium card program including 14 months interest-free and 1.5 percent cash back on purchases. The cash back earned by the cardholder is automatically deposited in his or her savings account. The Visa Signature card can also be tied to an interest bearing (2.01 percent) checking account.
“The program is relatively new for our members, but the response rates we’ve seen since launching in October are quite strong,” said Jose Gonzalez, Product Analyst. “We wanted to create a card offering that stood out from the large national issuers in our backyard. After extensive research, including surveys of our members, we opted for the automatic cash back rewards incentives and that really jump-started the adoption rush.”
The credit union’s initial campaign offer resulted in a 19 percent increase in active accounts in the first six months since the card launched in October 2015. Provident also reported that its outstandings and revenue grew by 18 percent and 14 percent, respectively, in 2015. Overall, from October to April 2016, the credit union has added over 2,800 accounts, with a 72 percent activation rate; generated $34,000 in monthly interchange and fee income; and outstanding balances have climbed to nearly $3 million with zero percent delinquency.
The credit union created awareness about its new card program through pre-approval offers to members, direct mail, ATM and in-branch messaging, website banners and staff training. The card’s graphic design features the prominent orange and black colors of the local San Francisco Giants Major League Baseball team. Provident is ratcheting up its next wave of awareness campaigns to include social media, articles in its monthly newsletter to members and pre-approval offers to non-members.
Provident Credit Union processes its premium card program and loyalty rewards through PSCU and has been an Owner Credit Union of the St. Petersburg, Fla.-based cooperative since 1995. PSCU has helped its Owner credit unions launch premium card programs since 2012 and processes 472,000 cards on behalf of 111 credit unions that offer those programs, representing over $1.008 billion in outstanding balances.
“Premium card programs have delivered higher average rates of interchange for PSCU’s Owner credit unions over time versus other card types, particularly in the airline and hotel spending categories (2.2 percent versus 1.9 percent, respectively),” said David Hall, SVP of Account Management. “PSCU can help credit unions evaluate the opportunity to implement and manage a successful premium card program for their members. These programs are a particularly good option for credit unions to explore to combat the effects of regulated payment card interchange compression.”
The CUSO notes that Visa Signature cardholders spend on average 29 percent more than holders of other non-premium Visa cards and conduct twice as many transactions on a monthly basis. PSCU Owners interested in learning more about the CUSO’s signature card programs can contact their PSCU Account Executive for more details.
About Provident Credit Union
Provident Credit Union is the 81st largest credit union in the U.S. and the 16th largest in California. The credit union was established in 1950 to serve the California Teachers Association. Headquartered in the San Francisco Bay Area, Provident Credit Union now serves more than 100,000 members from over 1,200 employer groups and maintains branches throughout California, and nationwide. Visit www.providentcu.org for more information.
Established in 1977, PSCU (St. Petersburg, Fla.) is the nation's leading credit union service organization (CUSO) and was awarded CUSO of the Year recognition by NACUSO. The cooperative is owned by over 800 member credit unions representing more than 18.9 million credit, debit, prepaid, online bill payment and mobile accounts. Comprehensive 24/7/365 member support is delivered through contact centers located throughout the United States. For more information, visit www.pscu.com.