Press
Re-Launched Portfolios Find Renewed Success
DES MOINES, Iowa – January 25, 2013 — As community financial institutions continue to evaluate their credit card options, many are still looking to a third-party agent issuer for solutions, including one that may not be so obvious – the re-launch of their credit card program.
During the past 18 months, TMG Financial Services, a third-party agent issuer, has helped five financial institutions restart their credit card portfolios and achieve account penetration of 3.1 percent, which is 150 percent greater than the national average of 2.2 percent.
“There are a number of reasons financial institutions look to restart a program with a third-party agent issuer, but the primary reason is the ability to partner with someone who has the resources to provide a competitive, cardmember-friendly solution,” said Jeff Russell, president and CEO of TMG Financial Services. “The turbulent economy and dynamic credit card industry have financial institutions evaluating the success of their products and partnerships. We’ve also seen other third-party issuers dramatically change their programs or exit the agent-issuing business altogether. This has opened up a tremendous opportunity not only for us, but for financial institutions looking for successful solutions that better fit their needs.”
Among the recent success stories of re-launched portfolios are Greater Nevada Credit Union and General Mills Federal Credit Union (GMFCU). Both credit unions ended their partnerships with other third-party issuers, but remained committed to restarting their credit card portfolios to provide their members a program better aligned with their other product offerings.
Financial institutions influenced by both sides of this environmental shift have turned to TMG Financial Services to renew the success of their credit card programs.
General Mills Federal Credit Union (GMFCU) made the strategic decision to find a new partner with a credit card product that better fulfilled the needs of their members. “We serve a great membership that expects access to a variety of competitive financial products,” said Marlo Hirl, vice president of marketing for GMFCU. “Everyone has a credit card in their wallet. If we aren’t providing a competitive program, then our members are building a relationship somewhere else.”
GMFCU originally sold its credit card portfolio because managing the program required comprehensive resources devoted to its success. Although there were disappointments with the first partner, the credit union determined it still needed to engage with a third-party agent issuer to provide a first-rate credit card program.
“It’s a tough decision to go back and start a program from scratch, but we knew we could find a better partner. Our members made it clear that we needed a different option. Fundamentally, we understood that if we provided a great program our membership would respond,” Hirl said.
The response was positive and immediate. In a year, GMFCU’s portfolio has added nearly 1,200 accounts.
“We worked with TMG Financial Services to establish an aggressive goal. In two years, we wanted to exceed the number of accounts with our previous partner. We are certainly on pace to accomplish this,” Hirl said. “It really shows we made a good decision that was in the best interest of our membership.”
While GMFCU chose to end its partnership with its original third-party agent issuer, Greater Nevada Credit Union’s relationship was terminated when the issuer decided to exit the business.
“The end of that partnership gave us the opportunity to evaluate whether we wanted to get back into issuing or find a partner with a product that aligned closely with our values,” said Tom Wambaugh, vice president of member services for Greater Nevada Credit Union. “At the end of the day, we were certain we wanted to work with a partner that could provide the complete product that we couldn’t.”
In a few short months, more than 500 Greater Nevada Credit Union members have been approved for the ATIRAcredit MasterCard provided by TMG Financial Services.
Russell said the re-launched programs among TMG Financial Services partner financial institutions have already surpassed initial expectations.
“The substantial growth of the re-launched programs under the TMG Financial Services umbrella is an indication of the strong relationship between the community financial institutions and their members,” he said. “It is also a testament to the importance of partnerships defined by mutual engagement. Financial institutions that re-launch their portfolios demonstrate a true commitment to collaborating for results. This engagement is critical to success.”
About TMG Financial Services
TMG Financial Services (TMGFS) is known for providing collaborative, innovative and consumer-oriented solutions in the payments industry. From industry-leading funding vehicles to comprehensive credit card programs, TMGFS ensures financial institutions have the tools to thrive in the competitive financial marketplace. TMGFS was ranked No. 340 on the 2012 Inc. 500|5000 list of the nation’s fastest-growing private companies and currently has more than 65,000 cardmembers and $135 million in assets under management. For more information, visit www.tmgfinancialservices.com.