At VentureTech 2023, Nickels CEO Joseph Gracia sat down with Joshua Barclay and Jonathan Taylor to discuss the US credit card market and how credit unions can compete on credit cards. Listen to the podcast below:
Highlights from the conversation:
Americans are brainwashed into thinking that credit cards are about rewards, when the truth is that over half the cardholders in our country revolve and the cost of their cards far outweigh the rewards they’re earning.
The top 15 banks, which control over 90% of the card market, win when we focus on rewards. In reality, they’re paying $40B out in rewards while charging $130B in interest and fees.
Credit unions have better credit cards for those who revolve, which is more than half of all cardholders. Our solution identifies members that are revolving on competitor credit cards and gives credit unions the tools to engage those members. This not only saves members money but also facilitates the growth of credit union card portfolios.
As a member, you may not be aware of our existence, but you’ll notice a shift towards more personalized and relevant messaging. For instance, if you’re revolving on a Chase credit card, instead of receiving communications about growing deposits, you’ll start getting marketing focused on how much you could save by switching to the credit union card. We operate behind the scenes, providing analytics and white-label marketing support to credit unions, ensuring they have the information to send targeted messages at the right time. Our goal is to enhance the credit union-member relationship by helping members save money and aiding credit unions in growing their credit card business efficiently.
We’re getting batch files from the core. For example, we’re part of Jack Henry’s Vendor Integration Program, which means that there’s a pre-built report that pulls the data we need to run our analysis. Our analysis runs monthly. This regular flow keeps the credit unions updated on how their members behave with competitor cards. Picture us as the newfound best friends of marketing VPs and card portfolio managers. In a world where constant card-focused marketing is crucial, we streamline insights and action so the marketing teams can have ongoing, personalized engagement with their members.
Our credit union partners are getting impressive results. Take Michigan State University Federal Credit Union, for example. In the first half of 2023, we helped them refinance $11 million in competitor credit card debt into personal loans, while issuing $13.4 million in new credit limits on their own cards. The segments we identify consistently apply at higher rates and are approved at higher rates than their general population.. The impact is clear and substantial.
Nickels is a CUSO that helps credit unions cross sell credit cards, shift spend to their cards, and refinance members’ competitor card debt. Founded in Ann Arbor, MI, their mission is to improve members’ credit card health, in part by shifting members from high interest competitor cards to lower rate credit union products. For more information, please visit nickels.us.