More credit unions are turning to a prepaid card to help in their drive to solicit business from Hispanic consumers.
Marketing plans for the Coopera Card are in place at eight credit unions across the U.S. to help the institutions include more Hispanics among their members. In all, 10 credit unions have agreed to market and issue the card, which launched last October.
The Coopera Card is a reloadable, Visa-branded prepaid card Coopera Consulting designed specifically for Hispanics, particularly first-generation, Spanish-dominant consumers who have little or no banking relationships. Coopera Consulting works with credit unions to grow membership and assets by reaching out to the Hispanic market.
The Members Group processes the card transactions, and FIS, or Fidelity National Information Services, provides back-end payment technology. Employers or cardholders may reload the card at issuer branches, online or at a merchant that supports the Visa ReadyLink card-reload program (see story).
Credit unions that will offer the Coopera Card this year include Amarillo Community Federal Credit Union in Texas, United Services Credit Union in North Carolina, Beacon Federal Credit Union in Texas, KEE Federal Credit Union in Nebraska, EECU in Texas, Greater Iowa Credit Union, Des Moines Metro Credit Union in Iowa and Guardian Credit Union in Wisconsin. Two others did not want to be mentioned at deadline.
The Coopera Card is different from other cards marketed to the unbanked primarily because credit-union members have more opportunity for face-to-face contact because the credit union is the issuer, Miriam De Dios, Coopera Consulting vice president, tells PaymentsSource.
“(Credit unions) need to have the right products, but they also need to know what to do to build the trust in the community, to have the processes in order to serve foreign nationals, immigrants and the primary target market,” says De Dios.
To tailor the card to unbanked and Hispanic financial behavior, like extensive use of international funds-transfer services, Coopera makes up to six cards available per account, for $10 each, for family members in other countries. For those who never have owned a financial card, there is bilingual customer service; live customer inquiries cost $1.50 each.
The card is accepted at any merchant or ATM that takes Visa, and cardholders may use the card for online purchases and bill payments. There is a $1 fee for each ATM withdrawal in the U.S. and a $2 fee for each international ATM withdrawal. Text alerts after each transaction are free, as are automated customer-service inquiries.
No credit history is necessary to sign up for the Coopera Card, and the credit unions accept alternative forms of identification to obtain the card. The card comes with a currency exchange processing fee of 1% of the transaction amount, half of that of Spanish-language media giant Univision’s MasterCard prepaid card, which comes with comparable benefits.
Univision offers free in-network ATM withdrawals ($1.95 for out-of-network) and free bilingual customer service, and its monthly fee is higher than Coopera’s ($9.95 compared with $5.95). It charges $1.95 per international ATM withdrawal and provides up to two additional cards for family member free (see story).
Another Spanish-language media company, Telemundo, paired with Western Union Holdings Inc. last year to offer MasterCard-branded prepaid cards. There is no monthly maintenance or live customer service fee. The fee for domestic or international ATM withdrawals is $1.95, and the currency exchange fee is 1%. Cardholders cannot have additional cards, according to a customer service representative (see story).
Credit unions are ideal for issuing prepaid cards because they offer one-on-one, walk-in services essential to a population that may need extra guidance, De Dios says. The goal for credit unions is to encourage Hispanics to feel more comfortable with a financial institution so they use more of that institution’s tools.
There is a certain level of care a smaller institution can give that larger issuers just don’t provide, Konrad Christensen, The Members Group retail payments product manager, tells PaymentsSource. “They get reporting behind the scenes, and they get to see how their cardholders are using the card and say either they’re not ready for a checking account or ‘look, they’re using it, they’re loading it, let’s get them into another product,’” he says.
Each credit union issuing the Coopera Card receives a marketing kit with culturally relevant and bilingual materials such as fliers and posters. Coopera also gives marketing calendar advice.
Arna Reynolds, CEO of Amarillo Community Federal Credit Union, tells PaymentsSource 33% of Amarillo residents are Hispanic. The card solves one main challenge for the population that sends funds to Mexico: security, she says.
With up to six cards available per account, no longer do family members have to walk away from the location where they received the money carrying cash, Reynolds says.
Reynolds says she hopes the Coopera Card will help Hispanics see her branches as more approachable. It took eight years for one of her branch locations to gain acceptance with Hispanics, she says.
“But once you earn their trust, they are going to tell everybody they know, and not be shy about it,” Reynolds says.
Amarillo Community’s locations will not offer the card until training of staff is complete. Marketing could include ads in Spanish-language newspapers, radio and TV stations, at the credit union’s expense. Locations will feature printed material as well, Reynolds says.
Esteve Coll-Larrosa, business development marketing manager for United Services Credit Union of Fletcher, N.C., says his seven-branch institution will take the Coopera Card message into the community by setting up tables at community centers and the weekly flea market in Fletcher.
Coll-Larrosa signed up his first Coopera Card user this past week, a lady who was concerned about fraud with her current account used by her son in Mexico.
“All we need to be able sell the card is a connection,” he tells PaymentsSource. “Word of mouth is the best marketing tool, and that’s how among the Latino community most news are communicated. If we have a few happy users, hopefully it’s going to spread like wildfire.”
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