Deposit growth issues come up frequently in strategic discussions with credit union leaders this year. One client even described the battle for deposits as “hand-to-hand combat.” Members and potential members simply have less deposits in this economic environment, and your competition is fiercer than ever before.
Growing deposits requires creativity and attractive ideas. It requires trying something new, rather than doing what you’ve always done or slapping the “CD Band-Aid” on it.
Here are five credit union deposit growth ideas to implement now.
- Joint accounts: This idea sounds simple … maybe too simple. Encourage members to open joint accounts when they’re in serious relationships. With two members’ money in an account, you get more deposits.
But the idea’s simplicity doesn’t change the fact that many couples don’t have joint accounts. In the U.S., 57% of couples keep at least some of their money in separate accounts (a number that rises to 69% when talking about Millennials). Many couples don’t feel the need to open joint accounts following life changes anymore, and it seems simpler to keep separate accounts.
Market the benefits of a joint account to a relationship. Talk about how joining assets simplifies budgeting and increases positive communication about finances. Spur people to act, and you can spur credit union deposit growth.
- Pop-up branches: Pop-up branches mitigate the downsides of indirect lending by exposing potential members to your wider array of financial services.
You can have a branch manager and member service representative rent a conference room at an auto dealership partner. Give them a laptop, check scanner, driver license scanner, signature pad and whatever else they need to help members open accounts. Use this tactic to expand into locations without branches – sparking credit union deposit growth alongside indirect loan growth.
- Community partnership debit cards: Partner with local high schools or businesses so members can add their logos to new debit cards as part of the card customization process. Research shows allowing card customization is highly effective, increasing retention by 18% and usage by 21%. You’ll also get in the good graces of community organizations by supporting their brands.
Your customized cards help someone feel like they have greater ownership over the card itself while also connecting them to the community. Emotion is a great motivator…meaning the account associated with the favorite card becomes a primary account and source of credit union deposit growth.
- High yield checking accounts: Marketing high yield checking accounts is a fantastic long-term play for credit union deposit growth. And unlike CDs, high yield checking accounts are easily understandable and geared toward lengthy relationships with members.
According to a MagnifyMoney survey, CDs confuse 50% of people and 48% of people have no experience using one. Young people are especially ignorant of a CD’s uses.
For those who do regularly use CDs, they hunt for the best rates … not a relationship with you. They always keep an eye toward greener pastures and won’t be shy about abandoning you for someone else’s superior rate.
Capture the member relationship with a high yield checking account, and you’ll capture their future deposits. Prevent a cycle of deposit shortages bound to occur with CDs.
- Subscription payment promos: A Financial Brand report suggests a credit union’s Primary Financial Institution (PFI) status connects to how a member pays their subscription bills. Adding recurring transactions to an account makes the account “stickier,” and 51% of people plan on paying more subscriptions in the future. This information opens credit union deposit growth opportunities.
It’s likely there are at least some deposits entering the account to pay for subscriptions, so incentivizing recurring payments on your checking accounts also incentivizes deposits. And the more transactions conducted from the account over time, the greater the need for deposits entering the account.
Design a promotion encouraging or discounting subscription payments from your accounts. Foster those sticky relationships and grant yourself PFI status.
Keep these credit union deposit growth ideas in mind during your strategic planning session this year or next year. Don’t try the same tired tactics over and over again. Instead, chart a new course. Complex problems require innovative solutions.