Imagine a day where members are no longer showing up at your door asking for a loan and your business intelligence analysts are presenting loan offers proactively through a mobile phone. That day has already arrived for credit unions.
My organization, BlueOx Credit Union, recently launched a 1-Click Credit Card Offer program. In short: loan offers in online and mobile banking to pre-qualified members who have precious little to do to get the card.
These credit card offers are underwritten by our business intelligence analysts who are learning the trade from their counterparts in lending. Questions are asked of the data similarly to how a loan officer would ask a member in front of them. “How long have you been a member with us? What does your relationship with us look like? Are you in good standing? What are you receiving in direct deposit? What is your credit score and how is it trending? What other debt obligations do you have?”
When these questions can be answered by the computer, it allows credit unions to quickly qualify members for credit card offers that fit their needs. The program allows for data segmentation to offer different credit card types, rates, and limits to different pools of members based on the data identified. The next time the member logs into their mobile app or online banking, they are presented with their credit card offer. With 1-Click, they can accept the offer and immediately have access to transfer balances while they await their card in the mail.
Launching the program as a pilot, the Business Intelligence department at BlueOx was able to identify 2,738 members that met the underwriter’s initial terms. These offers were then flooded out to the qualifying members. The credit union had close to 200 (7.5%) accept the offer within the first 45 days, and accepted offers continue to come in daily. On the processing side, it is as simple as mailing out the new card.
Many of the members began utilizing their new lines immediately by transferring funds to their checking accounts in online banking. Today, the 200 cards have added $120K in new balances on over $1.428M in combined limits. After 90 days, these offers tend to become stale and the program automatically purges unaccepted offers.
Amy Nichols, our VP of Operations said, “1Click Offers have really helped to jump start our credit card program and get it off the ground. In fact, it helped us two-fold. Not only did we have the self-service acceptance rate, but it also got staff talking about credit cards more. Getting cards in hands has already proven its return. The 200 new cards are averaging 5 swipes per month. Looking at the bigger picture, this equates to roughly $80,000 a year in NEW interchange income.”
With the high level of success on the first round, which was focused on higher credit borrowers, we’ve written 1-Click into our strategic quarterly initiatives. “There will be a different group of members in each round,” explained Danny Phillips, Executive Vice President. “The ability to really slim down our target group based on strong criteria that indicates success makes this program far more efficient and cost effective than traditional methods of acquiring credit cards.”