Why Credit Unions Are Winning With Millennials

Millennials are a high potential target for banks and credit unions.

According to a report by Mintel on “Echo Boomers and Finance”,  just 56% of 18-24 year olds own any banking product, usually a savings account (41%). But this figure jumps to 70% among those 25-29.

Credit Unions have been making the most of their historic opportunity to attract Millennials.

According to Mintel, several credit unions have launched “Young & Free” sites. These sites feature young spokespeople and include blogs, listings of “free items” or promotions available in the credit union’s local area. They also provide calendars of events, and financial literacy tools on topics thought to be of special relevance to Echo Boomers. These topics include:

  • car buying versus leasing
  • establishing and maintaining good credit scores
  • saving money tips
  • finding an apartment.

It only took a quick Google search to turn up several of these “young and free” initiatives, like this one in Alberta from Servus Credit Union. The site features spokesperson, Myles Peterson, who tweets, blogs and creates videos all focused on what’s happening in Alberta and with the Young and Free account at Servus. The site seems to have done its Gen Y homework: it is up to date, provides useful information and apps in a Millennial-friendly format.

There are other Young and Free efforts in Alabama (Listerhill Credit Union), South Carolina (South Carolina Federal), and Texas (TDECU). While the format is similar, each has its own spokesperson and unique content. There is substance as well. For example, South Carolina Federal offers special deals for 18-25 year olds:

  • fee refunds—the idea is that young people make mistakes with managing their checking accounts and the credit union gives them one free fee refund per quarter in recognition that they are still learning how to manage their accounts
  • online budgeting tools
  • mobile access
  • debit cards
  • no monthly maintenance fees
  • additional dividends on deposits.

Analyst, researcher and Millennial, Dane Coalson on CreditUnion.com provides a “Personal Gen Y Perspective” on which features are most meaningful:

Personal recommendations: “The first place I turn to before I purchase a product or utilize a service would be my friends and family for recommendations. I want feedback directly from someone who can tell me about their personal experience, and I’m not alone.”


Help establishing credit: “Helping us build credit is a great opportunity for credit unions to actually differentiate themselves and provide a service that Gen Y needs!”


A fresh, well-designed web site:If your website looks like it is stuck in the past, this can leave a bad impression.” (Duh!)


Plain English: “Don’t get wrapped up in using what you consider to be the coolest, hippest jargon.  Gen Y does not want to be pandered to, they just want easy access to straightforward, clear information.”


Details matter: “I believe that younger members can be easily swayed by seemingly insignificant details such as the ability to exert some control over how their personal card looks.”


Financial Institutions will never be ‘cool’ – this should not be your goal: “Instead, focus on showing them how you can provide better rates, help them build their credit, and actually are an honest institution that genuinely has their best interests in mind. Like anyone else, younger individuals are simply looking for a safe, efficient, non-problematic institution that they can trust with their money.”


Focus on what could draw Millennials into a financial institution today: “High interest products include direct deposit and bill pay,  good rates on individual product offerings, such as an auto loan, CD, high-interest checking or savings accounts.”

This is great advice for any marketer, not just financial services.

Coalson concludes by emphasizing his belief that there is “a window of opportunity” to attract members as they leave college.  But cautions that “once they start their jobs, set up multiple accounts, and become comfortable, it becomes much harder to entice them to switch.”

Kudo’s to Credit Unions for getting ahead of the curve.

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  • http://thefinancialbrand.com/ Jeffry Pilcher

    Mintel's data is wrong. Flat out wrong. Do they really expect us to believe that 44% (almost half!) of people 18-24 don't have a checking account??? Or credit card??? That has to be complete B.S. That's means 44% of people 18-24 neither have any money nor any job nor any bills to pay. That's means 44% of people 18-24 are purely cash-and-carry.

    The segment of the “unbanked” (as they are called) is small, and Gen-Y is not a big part of this group.

  • http://thefinancialbrand.com/ Jeffry Pilcher

    My friend Tim McAlpine, president and founder of the financial marketing firm Currency (based in Canada), is the creator of the “Young & Free” program. There are currently 4-5 credit unions running the program, with another 4-5 coming on board in the near future.

    You can find out more about this program here:
    http://www.currencymarketing.ca/

    Follow his blog here:
    http://www.currencymarketing.ca/Blog/

    He just made a great presentation on “Young & Free” here:
    http://www.slideshare.net/CurrencyTim/young-fre

    And you can follow him on Twitter:
    http://twitter.com/CurrencyTim

  • http://subcatmarketing.com/ James Flores

    Great post once again Carol. It's refreshing to see the spotlight shine on the credit union industry. As an aging industry (the average U.S. credit union member is 47 years old), many credit unions are under immense pressure to bring down that age and attract the next generation of members. Nearly every credit union I meet with has the same challenge. You can’t go to a single credit union conference without a session or two addressing the issue. It really is an industry-wide concern and there’s a lot of work being exerted to tackle this.

    I think you picked a great program to feature. Young & Free has done a great job of energizing credit union professionals tasked with engaging Gen Y. It’s made many people see that good things come to those who take a risk. And most importantly, it made social media seem less scary to many credit unions (trust me, this is a big deal). The program has had a profound influence and now we’re seeing more credit unions taking the leap of faith that Servus took a few years ago. In addition to Young & Free, we’re seeing many other great programs and innovative strategies emerge throughout the industry and enjoy similar success. It’s an exciting time to be a credit union youth marketer!

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  • Kevin Walker

    Carol:

    I am not sure if you are aware of the initiative that we created for EDS Credit Union now called ITCU but it is called The Arrival Guide. Check it out at thearrivalguide.com. Great article, we feel validated in our work for EDS Credit Union.

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  • ChristopherBPurrowes

    Lately there have been a lot more crimes pertaining to bank robberies. The robbers just walk into the bank with little union bank california or no disguise and no metal detector or security guards and hands the teller a note demanding money. They are placing the note on the counter with both hands. The notes state that they have gun and they demand money. Since both hands on the counter, no weapons will be shown. These robbers are edgy and jumpy and possibly agitated during the robbery.

  • http://twitter.com/FGYconsulting FGY-Foco na GeraçãoY

    EXCELLENT ARTICLE! CONGRATULATIONS!

  • Eric Acree

    Hi Carol. Vantage Credit Union recently launched “Young & Free St. Louis” with a product bundle that provides our young members with some innovative features and savings. We wrote an online banking system specifically for this crowd and the feedback so far has been great. Visit http://www.youngfreestlouis.com and click on the “Not Your Mama's Account” for details.

  • http://twitter.com/WendyWinder Wendy Winder

    Very good tips for the financial institutions