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CU System
Renewed Interest In Credit Up, Market Cards More--CO-OP, TMG
RANCHO CUCAMONGA, Calif. (2/27/13)--Now that consumers have renewed their interest in credit, credit unions should market their credit cards more aggressively, say CO-OP Financial Services and The Members Group (TMG).

"We are seeing renewed momentum for credit card usage," said Shazia Manus, TMG's CEO. "Balances are going up, credit lines are increasing, and so credit unions should be consistently marketing their credit cards to their members to remain competitive financial service providers."

"Credit and debit transactions drive non-interest revenue at credit unions," said Stan Hollen, president/CEO of CO-OP Financial Services. "If we focus on a few key priorities, credit unions can grow both debit and credit in 2013. As consumers look to deepen card usage, we can strengthen member relations by providing the convenience of these payment options."

CO-OP and TMG, which provide credit card transaction processing programs and other payment solutions to the credit union industry, will host a webinar March 20 at 12:30 p.m. PT about the debit/credit outlook.  Findings they will present include:

  • Consumers racked up $53.5 billion in credit card debt in 2012--five times what they accumulated in 2010, according to TRK Advisors.
  • Credit union card balances are up 4.6% since November 2011, according to CUNA Mutual Group. That compares with growth of 0.4% for the rest of the market.
  • Charge-offs have declined to less than 3%, says TRK Advisors.
  • Managing risk continues to be a challenge, but as the economy improves, so does the credit outlook for consumers.
CO-OP and TMG say credit unions can capitalize on the growing credit market by:

  • Increasing credit lines for responsible credit users who try to keep their card use under 30% of their total lines of credit;
  • Adding products that address credit-bruised consumers--a classic approach for credit unions;
  • Promoting credit to debit card holders and checking accounts to credit cardholders in a move to become the cardholders' primary financial  institution; and
  • Winning business with balance transfer offers.
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