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CUs reach out with no-debit-fee promos
MADISON, Wis. (10/7/11)--Banks' new debit card fees have become the last straw for many outraged consumers. Credit unions are jumping at the opportunity to let consumers know they can get a better deal at credit unions through a variety of no-fee promotions and anti-fee advertisements. For example, Raleigh, N.C.-based Coastal FCU took advantage of "active social media monitoring, brilliant staff execution, $35, a bale of hay, and a healthy dose of public anger" to buy a public relations coup in the wake of the Bank of America's (BofA) announced debit fee increase last week, said the North Carolina Credit Union League (Weekly Update . The $2 billion asset credit union decided in August to increase the dividend rate on its Go Green Checking Account to 2.51% for 30 monthly debit swipes, effective Oct. 1. It had announced the change to members and scheduled television ads to announce the change this month. "Other than television ads, we hadn't thought about doing a media announcement on the rate change," Joe Mecca, Coastal's marketing/advertising manager, told the league. The thinking changed when BofA's $5 a month fee on debit transactions was announced Sept. 29. That evening, Mecca and Lauren Stranch, Coastal's PR/networking specialist, monitored Twitter to gauge public reaction. "We noticed that people [on Twitter] were really angry about the bank fee, and our members were actually replying back to them to let them know about Coastal's account and including us in the tweet," Mecca said. Sensing an opportunity, the credit union jumped. It sent local media a press release announcing the increased swipe dividend on debit purchases and scored several hits, including WRAL-TV and the Raleigh News & Observer. It also brainstormed its new ad, "the last straw," and produced it the same day, Mecca said. Coastal Advertising Lead Paul Styron bought props for it: a bale of hay, some trash bags and a downloaded sound effects file. Total cost: $35 and staff time to edit the spot in-house. The ad hit the area's airwaves Tuesday and the credit union doubled up on its planned ad buy for the next two weeks. (To view it, click on the embedded video above.) Although it's too early to demonstrate any movement by the general public toward Coastal's checking account, Mecca said the nimble response was warranted in the competitive checking arena. "Checking is a cornerstone product. We know that a good, solid checking relationship leads to a broader relationship." Coastal's new Go Green product has been a major hit for Coastal. Members currently receive 1.01% annual percentage yield for a minimum of 12 debit transactions, and 2.51% for a minimum 30 transactions. The only qualifier: the rate is limited to the first $50,000 on deposit in the account. Other efforts in the wake of the BofA fees:
* Co-op Services CU, Livonia, Mich., launched a challenge to bank customers to go "ShredMyCard" and receive $105 to do so (MarketWire Oct. 6). Consumers can take their bank debit card to any Co-op Services location, open a free checking account with direct deposit, shred the old bank card, and receive $105. "There's a major difference here," said Anthony Carnarvon, president/CEO of the $401.5 million asset credit union. "The big banks will take your money for just having a checking account and debit card; we give you money." * CommunityAmerica CU, a $1.8 billion asset credit union in Kansas City, Mo., is seizing the opportunity to market itself with its Escape Your Bank promotion. Consumers fed up with their banks' fees can receive $75 for opening a new Free-ing Checking Account. "When you can have a Free-ing Checking account with no minimum balance, no monthly charges, free online bill pay and a free debit card, you'll start to see banks as pretty confining," said the credit union's website. "And no one likes confining." * Mission FCU, San Diego, announced Thursday it does not plan to charge monthly debit card fees (BusinessWire Oct. 6). "The credit union wants to reassure its 150,000+ members that these fees will not be heading to their pocket-books." "As a not-for-profit, member-owned community-based credit union, we answer to our members, not to shareholders or Wall Street," said Debra Schwartz, president/CEO of the $2.1 billion asset credit union. "One of the many benefits of credit unions is that we are able to pass those savings onto our members in the form of lower or no fees." * The Golden 1 CU, based in Sacramento, Calif., renewed its commitment to continue providing debit cards free. "Golden 1 is well known for providing value-oriented services such as free checking accounts and free debit cards," said Donna Bland, president/CEO. "Consumers who are affected by these new bank fees should recognize that they have a choice. They can choose to accept and pay these new fees, or they can send a message to their banks by taking action and moving to a financial institution such as Golden 1" with free services. Golden 1's Free Checking account has no minimum opening balance requirement and no monthly service charge. Accountholders receive a free debit card and have free use of online, mobile and text banking, and bill payment and online deposit services. * State Employees' CU, Raleigh, N.C., told (Oct. 6) it has seen an increase in new accounts in the past week, which could be a result of banks' new debit fees. "As a credit union, we are not in the business to make money. We are a not-for-profit cooperative," said Leigh Brady, SECU's senior vice president of education services. "Credit unions tend to be a better value for members…in terms of offering lower fees and better interest rates."


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