Credit card conversions often come as a result of a credit union or community bank learning of missed opportunities within their portfolio. Today, we see most of these discoveries falling into two categories: pricing and/or credit limits.

Pricing

Many community financial institution shy away from risk-based pricing. This leaves a significant opportunity on the table in terms of both revenue and cardmember satisfaction.

Setting custom-tailored rates to fit an applicant’s credit history does require specialized expertise, but the return is worth the extra effort. This is true not just for the financial institution, but also for members of the local community who may be turned down for credit with traditional underwriting. Risk-based pricing allows issuers to lend to consumers of higher risk and still be profitable.

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