Texas Dow Employees Credit Union has launched what it calls a “family card” to its credit card product offerings.
The family card “begins with one cardholder and a line of credit,” says Ron Wright, Texas Dow vice president of payment systems and lines of credit, told Credit Union Journal, a PaymentsSource sister publication. “If the cardholder is a father with two children and he has a total line of credit of $1,000, the main cardholder can allocate a portion of the line of credit to each of the dependant cards.”
Billing for the family card comes with two options. The primary cardholder automatically gets a master statement, regardless of the number of dependent cards. The primary cardholder also can be designated as the person responsible for paying the entire balance of all cards. As a second option, the primary cardholder still gets the master statement with all activity, but the dependants receive a statement for activity only on their cards and are responsible for paying their portions.
What makes the family card special is its ability to allow underage dependants to shape their credit file, Wright said. If dependants are younger than 18 when their card history begins, when they reach 18 they can choose to “spin off” and form their own account.
“It allows parents to teach their children how to use credit cards,” Wright said. “If a parent has a child in college, the credit line on the dependant card can be increased to allow payment of books or tuition.”
Dallas, Texas-based TNB Card Services created the product. Texas Dow is the first issuer to offer the card, Wright said.
Texas Dow also is offering families a student credit card, which charges a 0% annual percentage rate until the holder graduates or withdraws from college. Members who take out a student loan through the credit union qualify for the card.
The student card has a low $2,000 limit. Card users make regular monthly payments, but interest is deferred until six months after leaving school. “To our knowledge, we are the first to offer this product,” Wright said.