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The Revolvers Among Us: How Identifying Them Can Unlock Loan Growth and Improve Member Financial Well-Being

This research unveils an opportunity for credit unions to refinance members' revolving credit card debt to grow the credit union's loan portfolio and net interest margin while also improving members' financial well-being.

  • Corey Stone Senior Advisor at Financial Health Network

Executive Summary

More than half of Americans revolve on their credit card balances, lowering their credit scores and depleting their savings, especially when they prolong their indebtedness by making smaller monthly payments than they could. 

Credit union members who owe credit card debt are often hidden to credit unions. In this study, Nickels CUSO analyzed a year’s worth of transaction data from members’ primary checking accounts at five participating credit unions to help identify the opportunity for credit unions to grow their footprint in the unsecured credit market and help improve member well-being. 

Credit Union Implications

Strategically targeting credit card revolvers to help them shed their card debt is a new and evolving art. The benefits to the credit union—increased loan revenue, expanded debit card use and interchange, and ultimately increased member savings and deposits—are readily apparent.

Among the five credit unions who took part in this study and shared their members’ checking transaction data, the numbers suggest that making refinance loan offers to such members could enable the credit unions to triple their personal installment loan balances while immediately lowering members’ monthly interest costs and shortening their time in card debt.

Download this brief to help your members shed their card debt and improve their financial well-being.

Filene's Center for Innovation & Incubation is generously funded by:

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