In a recent article, Parade Magazine has encouraged readers to apply for credit cards at a credit union, because they are “less likely to impose burdensome fees.” See the article in CUNA News Now.
As the article continued with various and sundry items about credit cards, it concluded with the fact that credit card debt in the U. S. has reached $1 trillion, with the average household having $9,840 of this kind of debt (compared with $2,966 in 1990).
I was visiting with my friend Tony, here at TMG, about this, asking if he was above that average and if he could pick up the slack since I was below that average. Just a joke, just a joke. But on a more serious note, he commented on how ironic that [credit unions issuing credit cards] was.
We (credit unions) are promoting the very product that has brought so many consumers to the edge – in many cases over the edge – of financial well-being.
He went on to suggest that maybe we (credit unions) should begin a campaign to educate and promote responsible credit instead of just promoting the use of credit. An interesting idea indeed. I’m sure there has to be some of this going on out there, but probably not as much as there needs to be.
How does your credit union promote credit cards to your members? Do you incorporate responsible credit education into your promotions?
1 comment so far
1 Gene Blishen // Sep 1, 2008 at 12:53 pm
I have seen a number of banks and CUs refuse to lend below $5,000 because of the cost involved in setting up a loan of that size. They push a credit card (revolving credit) onto people who want term loans. Term loans eventually get paid off. Revolving credit is another matter.
Recently banks and CUs in Canada moved from a 25 year amortization period to a 40 year amortization period. That was recently moved back to 35 years.
At the CU were I work we give term loans for any amount and didn’t change above a 25 year amortization schedule for mortgages. Doing otherwise is not responsible. Some may disagree.
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