Fact: youth banking is the entry ramp into a credit union.
Fact 2: Credit unions, most of them, will admit that youth banking is not exactly their strongest suit.
Enter Cardinal Credit Union, a Mentor OH based institution with assets around $335 million, where CEO Chistine Blake saysthey are winning big in attracting youth to get credit union accounts by doing a lot of innovative thinking and mixing in fun activities.
Blake, by the way, is a past podcast guest. In episode 342 she talks about the institution’s relationship with the Cleveland Browns and its Little Brownies debit card aimed at kids. Since then she has turned to Nuuvia - formerly Incent - where president Marcel King and team have developed a range of youth banking tools and ideas. King, too, is a past guest. He was on episode 360 with Pioneer Federal Credit Union EVP Tracey Miller where they talked about youth banking.
On this episode King and Blake dive deeply into what Cardinal is offering, why kids like what they see, and why all of this matters in helping to insure a credit union’s long term success. In the process King shares compelling data on youth banking at Desert Financial, a big credit union in Phoenix AZ.
Listen up.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_02 (00:00):
Welcome to the CU2.0 podcast.
SPEAKER_00 (00:05):
Hi, and welcome to the CU2.0 podcast with big new
ideas about credit unions andconversations about innovative
technology with credit union andfintech leaders.
This podcast is brought to youby Quillo, the real-time loan
syndication network for creditunions, and by your host,
longtime credit union andfinancial technology journalist
(00:27):
Robert McGarvey.
And now, the CU 2.0 podcast withRobert McGarvey.
SPEAKER_02 (00:35):
Here's a fact youth banking is the entry ramp into a
credit union.
Fact two, credit unions, most ofthem will admit that youth
banking is not exactly theirstrongest suit.
Enter Cardinal Credit Union, amentor, Ohio-based institutions
with assets around$335 million,where CEO Christine Blake says
(00:56):
they are winning big andattracting youth to get credit
union accounts by doing a lot ofinnovative thinking and mixing
in fun activities.
Blake, by the way, is a pastpodcast guest in episode 342.
There's a link to that in theshow notes.
She talks about theinstitution's relationship with
the Cleveland Browns and thecredit union's little brownies
debit card and the kids.
(01:18):
Since then, she's turned toNuvia, formerly InSen, or
President Marcel King, and teamhave developed a range of youth
banking tools and ideas.
King too is a past podcastguest.
He was on episode 360 withPioneer Federal Credit Union EVP
Tracy Miller, where they talkedabout youth banking.
On this episode, King and Blakedive more deeply into what youth
(01:41):
banking is about andspecifically what Cardinal is
offering, why kids like whatthey see, and why all of this
matters in helping to ensure acredit union's long-term
success.
In the process, King sharescompelling data on youth banking
at Desert Financial, a bigcredit union in Phoenix,
Arizona, that's getting someterrific results.
Listen up, you'll hear thenumbers.
(02:04):
You know, what I was looking atyour website, one thing that you
have that intrigues the hell outof me is uh what's this madness
game where Oh the Mad City?
Mad City, yeah.
Tell me about that because yeah,and what age group is this for?
SPEAKER_01 (02:23):
That we do it mostly for our high schools.
It it can be any age group.
It could be middle school andhigh school.
There's different versions ofit.
SPEAKER_02 (02:31):
I I wish I'd had a class like this when I was a
senior in college.
SPEAKER_01 (02:36):
I love this one.
This this version that we do forhigh school, we turned it into a
competition because we weretrying to find a way to award
scholarship dollars and not makeit so much on the traditional
grade point average essay.
And so we wanted something alittle bit different that was
more inclusive to everyone.
So we were using this in ourteaching, and then we thought,
(02:58):
you know what, let's turn itinto a game.
So basically, what you do is youget a job, you get a person, and
then you get a family, andeveryone's everyone's different,
and you get a job and a salary,and then during the game, you
have to go buy your house, yourtransportation, your extras.
(03:19):
And then the goal is at the endfor us, you have to come within
a certain dollar amount.
And then if you're not doing itas a game, you're trying to just
teach overall money management.
And so we do it in teams as wellto make it more fun for the
students.
So we do it in teams of three orfour, and then collectively
their average has to equal X.
(03:39):
So it is so it is like my bestfavorite day to hear these kids
talk, and every time it's thesame thing.
My I got a bus pass for my, youknow, my wife, and I, you know,
and I got the thetransportation, or we don't need
that big of a house.
And it's so, so endearing tohear them talk about it.
SPEAKER_02 (03:58):
How many, how many children are you as your credit
union touching today?
SPEAKER_01 (04:04):
Oh, I would say over, probably, I would say
anywhere a minimum of 500.
That would be like a minimum,probably over a thousand each
year.
Because we teach each semesterat each of our five schools, and
then we do the Mad City foreveryone at the end of the year,
but each semester we teach aclass.
(04:25):
So we're hitting all thosestudents in addition to being
our student branches at theschools as well.
SPEAKER_02 (04:31):
And this is all under the Dream Chasers label.
SPEAKER_01 (04:37):
No, this is just all under, this is just all under
sort of our high school branchesand and the dream chasers, yes.
SPEAKER_02 (04:44):
Marcel, let's cut to you.
Why the name change?
SPEAKER_04 (04:48):
Oh, great, great question.
Um, so when InScent was created,uh, it was created specifically
for youth banking, right?
And the actual concept, I thinkRichard Logan, when he started
the company, was he wanted toprovide a way to incentivize his
kids to do chores and do tasksand things on that line.
And so he used the word uhincent as the kind of technology
(05:11):
and the platform.
Uh yeah, after the uhacquisition, uh, you know, what
a key difference between just ayouth banking strategy versus
what we wanted to do, which wasmore of a lifecycle banking
strategy.
Uh, we wanted to associate thename to be more related to the
vision and the strategy of thecompany.
(05:32):
So Nubia uh is a concatenationof kind of new, which is you
know, NEW, and via, which ispast.
So kind of a new path tobuilding lifelong relationships
is the kind of background on uhthe name Nubia.
Uh and so that's that's what wedecided we wanted to do and
execute on was you know create alifecycle banking product
(05:53):
starting with the youth uh andtherefore uh Nubia.
SPEAKER_02 (05:57):
Now, Christine, what what's in it for the credit
union to reach out to kids?
SPEAKER_01 (06:03):
Oh, there's so there are so many advantages and
opportunities reaching out tothe kids.
The first being, I mean, westarted, as you know, as a
schools teacher credit union,which anyone could belong to our
credit union now.
So we've always had a commitmentin financial education.
So the first is we found thatthe market, the earlier you get
(06:23):
education financially to people,the better off they will be over
time.
So that is the big motivation isto make sure that we are walking
with their very, very similar tohow Marcel said, we are walking
them through the life cycles,and the life cycle has been very
early.
It's not now where you open anaccount for your child and put
some money in it and leave it.
These these young people areactive and they're active at a
(06:46):
very early age.
And after we saw the whole2008-9 crisis, we realized how
much education had been lackingin this younger age group.
So that's where we started withthe high schools, and then we
slowly moved down, you know, tothe middle school children.
So that's the reason why isbecause we feel that people will
be better off.
And if we're the partner,honestly, that walks through you
(07:08):
through life, you're you're mostlikely to give us a first look.
So when you're gonna go get yourauto loan or your car loan, or
maybe you want information inthat buying process and you want
to talk to somebody, or you wantit digitally, you're probably
gonna be more put more emphasison someone that you've worked
with before.
And so we want to be thatpartner that's been alongside
(07:29):
you your whole journey.
SPEAKER_02 (07:31):
You you said it's relationship with kids to to the
institution are different, it'sdifferent from what it was years
ago.
And that reminds me when when Iwas a little kid, maybe six
years old, my father took me toan SNL and put some birthday
money in it.
20 bucks.
I don't heck of a lot of money.
And um I don't remember thatanybody put any more money in
(07:55):
it.
I do remember when I was 21, Iwent and withdrew what was in
it.
And it wasn't a heck of a heckof a lot of money.
It was like$21 at that time.
It was something like that.
And if you said, I'll give you athousand bucks if you could tell
me the name of the institution,I'd say, No, you win.
I don't know, I don't remember.
It's I just knew I had thislittle savings passbook.
SPEAKER_01 (08:18):
Oh, that's exactly.
And it's about adapting tochange and meeting people where
they are.
Remember the passbooks?
When I I started in 2010, Ifound some old passbooks where
you used to put the quarter in,you know, you put the quarter
and then you bring the wholepiece into foot into your
account.
I I don't think most kids arelike even touching money very
much anymore.
unknown (08:38):
Yeah.
SPEAKER_02 (08:38):
Well, that's one of the key differences, is that a
lot of kids don't get any money,and but they do get a debit card
credit from a parent orsomething.
SPEAKER_01 (08:47):
Right.
And that's what's so beautifulabout this product.
Uh, and I as soon as I saw it,like that's what's so beautiful
about it.
I'm just so happy that Nuvia hasnow, that insects, you know, now
Nubia, because of what they'reable to do, is exactly that now
you're educating them in thesame way.
It's just not the same way, it'sdifferent, but it's actually the
(09:08):
same.
It's the concept of money, it'sthe concept of why you're
saving, what's important aboutsavings.
And your parent can walkalongside you, which is also
great.
I mean, one of the greatfeatures, and this is a really
fun feature, there's a there's afeature in there where you can
do a loan to your child and showthem like what it would be like
to pay interest back when you'reborrowing money from your
(09:29):
parents, not just always we'regiving you money or you're not
just always earning it forshorts.
That part teaches you what it'sgonna be like later on when
you're going to get a car loan,home loan, or anything else you
might be financing, but you'relearning that concept very
early, again, with you know, nocost to you essentially, because
you have the learning experienceand you're not gonna go wrong uh
(09:50):
very big at all.
SPEAKER_02 (09:52):
Now, Marcia, you just got a rave review.
So tell tell me about theproduct.
Tell me about the product.
What's Christine raving about?
SPEAKER_04 (09:59):
Yeah, if you think about today, most credit unions
have youth accounts.
Either they start with a savingsaccount, some have teen checking
accounts, um, and or and orboth.
And so when you start thinkingabout that uh and how those
consumers, that demographicengage with your institution, if
(10:20):
it's just a savings account,they're never going to engage.
If they get a checking accountwith a debit card, they get a
debit card, but they're notreally learning anything by just
getting a debit card unlesstheir parents start teaching
them or they take a financialeducation class in high school,
whatever it may be.
So what we're doing with Nubia'syouth banking product is
(10:41):
coupling financial educationwith real money application,
right?
So, yes, you can learn aboutsavings, but then you can go
actually build a savings goal,right?
Or you can learn about uh youknow loans and then your parent,
you can borrow money from yourparents or uh or budgeting,
right?
So we're we're really taking thetwo things that need to be
(11:02):
applied together to actuallyunderstand how those kids'
behaviors change.
Because if you think about justthe financial education side,
and I've talked to hundreds ofinstitutions, I asked them, how
do you measure the success ofyour financial education
program?
The traditional answers are uhparticipation, right?
So I had 20 kids.
(11:23):
Uh, it could be a test at theend, like here are the concepts
that you learned, and there'syou know, multiple choice, et
cetera.
But what I haven't been able tofind with any institution is
okay, how are you measuring theimpact of the behavior to know
that this is actually working,right?
Because if you think aboutfinancial literacy in the US,
57%, only 57% of the consumersin the US households are
(11:46):
considered financially literate.
And that has stayed prettyconsistent over the last 50
years, right?
So although we're providingeducation, understanding how
effective it is is verydifficult.
So we we see the opportunity toactually tie those two things
together with the kind of thesix big modules that we have,
which is you know, the financialeducation, that's learn.
(12:07):
There's earn, which is beingable to teach your kids about
earning money, right?
So giving them a task to do,paying them their allowance,
paying them for grades, um, youknow, so you can you know
basically give themopportunities to earn money.
Uh, and then you have the spendside, which is now they have a
debit card that they canassociate with that money, and
they're now understanding, hey,if I spend 10 bucks on this,
(12:29):
that means that I'm gonna havezero left in my account to buy
something else, right?
Uh, there is a give module, acharitable giving module, so
that kids can learn aboutcharitable giving.
Uh, there is a uh savings bucketwhere a kid can actually save up
for whatever they may want orneed down the road.
It could be a bike, it could bea skateboard, the next video
(12:50):
game.
Uh, but as Christine mentioned,the kind of the crowd favorite
is the parental lending modulewhere you can loan money to your
kids and apply interest rates tothat, uh to that loan and teach
them about uh credit and theimpact of interest when you're
borrowing money.
So those are the big modules,and we're trying to make sure
that we tie those together sothat kids are basically building
(13:12):
better money habits uh earlierin their life so that as they
you know get to college, theydon't go and immediately go
apply for a credit card and thennever pay it because they've
understood what it means toactually make the payments on
the cards and and the loans thatyou're doing.
So that's that's the primarygoal.
It's really just to apply thefinancial education to actual
(13:33):
real money applications to teachkids better financial money.
SPEAKER_02 (13:38):
How willing are parents to be open about the
family finances with kids?
And I say in my family, I I haveno idea how much my parents
made.
No idea at all.
Were we middle class, uppermiddle class, uh lower middle
class?
We were one of those classes.
I know that.
We weren't rich, we weren'tpoor, but somewhere in there.
(14:01):
But I couldn't tell you whichone we were.
Uh we never we never talkedabout money, and money is seemed
like a bottomless resource.
Not that we were rich, but youknow, I asked my mother for five
bucks, she gave me five bucks.
She didn't say, now don't askagain for 10 days.
She never said that.
SPEAKER_03 (14:18):
You should have, probably.
I had to work for I had to workfor mine, Robert.
I had to mow lawn, go wash acar.
SPEAKER_01 (14:24):
Yeah, I'm not sure it's a lot different in what the
families, you know, families areunique and families share
differently.
I think it's more about thefamilies sharing and talking
more about either what allowanceyou're getting, what you're
earning, and how you're gonnaspend your portion than here's
what I pay for my mortgage.
No, here's what you are making,here's what you might be
(14:45):
earning, and what within thatcapacity can you afford to do?
And again, like these buckets,you're gonna afford X amount.
Are you gonna save some of that?
Are you gonna give some of that?
So I think it's more about theparents having the conversation
and the ability also to have itdigitally, which is faster and
quicker, and how most youngpeople respond, so that you're
getting that piece of it so thatby the time you are more
(15:09):
educated and as you grow older,you'll you'll figure out where
you where your family might be,you know, economically, but all
the while it really doesn'tmatter in the sense of you're
learning how to manage what yourincome is, so to speak.
unknown (15:24):
Yeah.
SPEAKER_04 (15:25):
And and let me let me just to kind of give you some
perspective on kind of howthat's applied within the
experience, the parent isopening up an account
specifically for that kid,right?
Where the money is going to gointo that account.
So anytime the kid um, you know,if even if they start a job,
right, they still have anaccount, it's a primary checking
(15:45):
account.
The parent is a joint owner inthat account, so that allows
them to still control theaccount and but move money into
that account.
But the kid can also receivemoney into that account from
grandma or Uncle Joe, whomeverit might be.
So they have a real checkingaccount.
They may not call it a checkingaccount, some call it a spend
account.
And now they have a debit card,right?
So to Christine's point, it'sabout how do you help that kid
(16:09):
understand how they need to earnmoney and what does money mean?
I had a 14-year-old uh niecethat uh stayed with us for a
little while, and she had noconcept of what money meant,
right?
She just saw me swiping card,right?
Uh, and so anytime we gosomewhere, she'd ask something,
you know, ask for something, andI'd say, okay, well, do you know
how much does this cost?
Well, what does that mean?
Right.
So it's it's trying to createthat relevance of what money
(16:31):
means and how does it um helpyou, and also how can it also
hurt you if you're doing thewrong things with it.
Um, so to Christine's uh um uhyou know comment, it's not
necessarily about what I earn asa parent.
It's how do we teach you whatthat means and what money means
and how do you actually manageit so that it helps you benefit
yourself and your family andothers uh as opposed to just you
(16:54):
know spending it willy-nillywithout even thinking about you
know what you're actuallyspending on.
SPEAKER_02 (16:59):
The important thing is learning that money is
finite.
Yes, even for Elon, even forElon Musk.
You hit it on the hand finite.
Yeah, his finite is a lot biggerthan mine, but it's finite for
him.
It's uh and that's that's alesson that's hard for a kid to
absorb.
Uh I I geez, I probably was 21before I absorbed that lesson.
SPEAKER_01 (17:22):
And I think too, it comes at different points, is
like I said, when they're readyto absorb.
So for example, another anotherneed that we found is we have a
lot of high school studentsgraduating, you know, to
college.
Then they may have theiraccounts with us through
college.
Then when they're out of collegeis usually when they have their
first, you know, first, first orsecond job, sort of like their,
(17:43):
you know, their sort of grown-upjob.
They have that job and nowthey're going to be living on
their own.
So they have different things toconsider that they didn't have
to before.
Okay, now I have to figure outhow much do I spend on an
apartment or where do I live, ordo I have to buy a car and car
insurance now?
So there's a whole nother pointof budgeting differently at that
age group.
And one of the nice things aboutthe Dream Chasers is it's now
(18:05):
structured in a product that canhelp you through life's journey
versus just at one point intime.
And that's a great addition thatthey're bringing uh to the
product, which I think isfantastic.
SPEAKER_04 (18:17):
Yeah, and then that really kind of ties back to that
life cycle banking, right?
So you think about asix-year-old, what might a
six-year-old use in thisapplication?
When it's, you know, it'sdigital, they get to create
their own little avatar.
Generally, it's going to besomething along the lines of
savings account, understandingwhat savings is, how do you
actually save money?
What does it mean?
And how does it help youaccomplish your goals?
(18:38):
Uh, and and potentially,depending on the institution and
the parent, maybe a debit card,right?
Because now they may want to gobuy their next doll or a toy or
whatever it may be, but at leastnow you're showing them that,
hey, you had$20 here, you paid$5for your toy, this is what you
have left.
It is this is finite.
So you got to think about how doyou want to save or spend this
(19:00):
money based on what yourlonger-term goals are.
Uh, and then as you uh age, likea teenager, it's probably more
of the uh capabilities andfeatures that are going to be
used, obviously the debit cardwith penal parental controls,
but also that budgeting, right?
So you start thinking aboutteach teaching the kid about
budgeting so that as theyprepare to move off to college
or their first job or on amission or whatever it may be,
(19:22):
that they need to budget theirmoney.
But you're able to teach themthat within that application uh,
you know, earlier than you know,later, right?
So it gives that parent anopportunity to help teach the
kid, hey, here's how you need tothink about budgeting the money
that's coming in with the moneythat's going out so that you
don't uh you'll have your billsturned off or your phone turned
(19:43):
off or get kicked out of yourapartment or whatever it may be.
SPEAKER_02 (19:46):
Now, do do kids today understand cash money?
SPEAKER_04 (19:53):
Understand cash money.
I I yes, I I if if their parentsare teaching them about cash and
they actually understand what itmeans to earn, you can teach
them about the cash moneybecause and I'll go back to my
14-year-old niece.
You know, I gave her five bucksfor, you know, I'll call it
washing the car or whatever itmay have been, and she wanted to
pie a buy a pack of gum, right?
And nowadays you can't buy gumfor you know 25 cents anymore.
(20:17):
It's like you know, three bucksfor 15 pieces of gum, right?
This is terrible news, Marcel.
How can you share this?
Yeah, so but but here's here'sthe point.
I said, okay, here's your fivebucks.
The gum is three dollars.
That means that you're onlygonna have two dollars left.
So do you really want to buythis gum or do you want to save
this money for you know the thedoll that you wanted, which is
(20:38):
you know, 50 bucks, right?
And uh she thought about it fora minute.
She's like, okay, I'm gonna skipthe gum, right?
And she came to five bucks,right?
But that was an opportunity toteach her about this is the
value of money, it is finite,and you need to be thinking
about what are you trying toaccomplish, what are your goals,
what do you really want versusuh what do you need versus what
do you want at this time, andand actually you know kind of
(21:00):
holding on to that money for alittle bit longer.
SPEAKER_02 (21:02):
Now, can your app do what you just did with that with
that girl?
In other words, what you weredoing was you were acting like a
coach.
You're saying, here's someoptions here.
Here's here's your reality, thisis what you got, and you want to
do this, but then you can't dothat.
Now can the app do that?
Because I mean that's great.
That's great teaching.
(21:23):
Yep.
SPEAKER_04 (21:23):
So there are there are two components to the app,
uh, and Christine may have, uhI'm sure we'll have some
additional insight on this.
Is number one, the kid can setup for a savings goal, right?
So if they have a savings goal,they can look at their savings
goal and see how far along theyare in that goal.
So if it's a$20 for a doll uhand they have$5 in their
(21:46):
account, they can see, okay, Ineed$15 more dollars, right?
So that's one component of it.
The second piece is that theycan see their balance in their
accounts.
So they can open up their phone,they can look at a balance and
see that they have$15 in theiraccount and they're looking to
purchase something that's$5.
You know, again, simple math.
Okay, if I spend this five now,that means now I'm$20 less than
(22:07):
what I need to do to get mydoll.
So those components are kind ofbuilt into the system so that
they can see what their balancesare, they know what they're
spending, and they can determineif they want to actually buy
something based on what's intheir account and what they're
looking to do longer term.
Chris, can you anything to addto that?
SPEAKER_01 (22:24):
I would say, and vice versa, the other way too,
you can approve transactions.
So the other the other flip sideof it is that you're going to do
a transaction and you have itset up to approve over X dollar
amount.
The parent sees that and goes,okay, you're not spending, you
know,$30 today on X.
I could see where you are.
You know, I might be denyingthat transaction, and then I
might be sending you a message,hey, you know, that's a little
(22:45):
out of your range.
Look at what you have, and youcould send the message back and
use those as teaching momentstoo.
So that's another way that theapp works in a different way,
but basically accomplishing avery similar goal.
SPEAKER_02 (22:57):
Christine, how do how do you keep the kids
engaged?
Yeah, it's that it's you know,kid hits the first obstacle and
then says, ah, hell, I don'tlike this game anymore.
It's you know, it's not workingfor me.
SPEAKER_01 (23:10):
I will say it is a constant challenge.
You know, anytime you're wickingwith the youth and trying to
understand, you know,generationally what motivates
them.
We're very fortunate because wehave advisory council, we have
our high school students, wehave middle school students, so
we get to engage and see whatthe buttons are, so to speak.
You know, what incentives getthem to react, what games get
(23:32):
them to react, and what trulymotivates them?
It's different across the board,but it is constantly changing.
It's just a matter of us stayingup on top of it and having the
tools like this that we wealready have in place.
Now, how do we use them a littlebit differently to keep them
engaged?
And sometimes maybe it's justtrading up.
You might find out, oh, here'sthe content.
So, for example, we took out, weoriginally had crypto uh content
(23:55):
and and modules in in the app.
And then we took them out, youknow, a couple years ago because
it was all no crypto, everythingwas you know very bad about
stable coin now.
It's all like you got to get itback in as fast as you can.
So it's also about what keepsthem engaged is making sure that
you have the relevant contentthat they're looking for at that
point in time.
(24:15):
So that's a piece of it that Ithink keeps them engaged.
SPEAKER_04 (24:19):
And I think the there's another piece of this is
really around kind ofgamification.
So one of the ways that we tryto drive engagement with the
kids is through thisgamification, in which if they
complete a specific goal, sothey set up Sami's goal and they
achieve their goal, they get atrophy.
If they uh watch a particulareducational module, they get a
(24:41):
trophy, right?
So we're giving them trophies,and within that family, if there
are more than if there's morethan one kid, you can see your
number of trophies versus othermembers in the family.
Uh, and then across the entirecredit union, you can see your
ranking.
You don't necessarily see otherkids' names, but you can see the
ranking where you kind of sit uhin that space.
(25:01):
So you know, trying to leveragegamification as a way to drive
uh engagement beyond just themjust spending and you know
earning the money, right?
SPEAKER_01 (25:10):
And good behaviors that are fun.
I mean, they find that fun.
It's the world that they'regrowing up in.
And then when it's fun andengaging, they're more likely to
then continue on those behaviorsthat help them in the future.
SPEAKER_02 (25:25):
Now, is this bringing more families into the
credit union, Christine?
SPEAKER_01 (25:30):
Yes, I would say yes, because a we we have this
program and we have our littlebrownies debit card within this
program as well.
You can have any debit card, youcan have our little brownies
debit card, you can have regularcardinal debit card.
We're getting to launch a fewdifferent ones too.
So we have this selection ofcards to use.
They all work the same withwithin within the module.
(25:52):
And each opportunity is nowwe're getting exposure to a new
group of people and showing themwhat we have.
Now we have this debit card,kind of like what Marcel said.
We're not just giving you acredit card or a debit card,
we're giving you this with allthese tools.
And so as we're introduced toall these new groups, they're
now seeing the value in thisproduct for their children.
SPEAKER_04 (26:12):
Yeah, I have some data.
Uh so one of our credit unionsum is uh fairly um uh they're
all in on youth banking, desertfinancial out of Phoenix,
Arizona.
They're about 9 billion inassets, and we did a case study.
Uh, and here are a couple ofkind of key data points to the
to the question that you'reasking.
Adoption rate amongst theexisting youth accounts reached
(26:34):
30% in the first six months.
So they have a 30% adoption ratewithin their existing youth
accounts.
They have acquired, increasedtheir number of youth accounts
by 32% over that six months.
Uh, they have increased thelevel of deposits 22% increase
in deposits over that six monthsacross all of the youth
(26:55):
accounts.
So you're looking at kind of theone element of engagement that's
retention, uh, acquisition ofadditional youth accounts, but
it's also acquiring new parentswho were never members at the
institution to open up accountsbecause of this uh kind of call
it the you know youth bankingexperience.
So now you know a parent whocomes in with three kids has to
(27:17):
open up four accounts, right?
Their own, where the money isgoing to move into to that
parent or uh into the parent'saccount from the kid when
they're borrowing money.
Um, and so there's thatinteraction.
But you know, it's it's drive, Ibelieve Desert was somewhere in
the two to three percentincrease in net new members
because of this, uh, because ofthis service being offered in
(27:38):
their community.
And right now they're the onlyone in the kind of Phoenix area
to offer this service, and theyare heavily promoting it, which
is driving that level ofadoption, engagement, uh, and
member acquisition.
SPEAKER_02 (27:51):
Well, I think they're one of the, I live in
Phoenix, they're one of thebiggest credit unions around
here.
And I'm surprised other creditunions aren't looking at their
success, saying, I gottaoptimize bus too.
SPEAKER_04 (28:03):
So we do have some prospective clients that are in
the Phoenix area that are nowlooking to launch Phoenix
banking.
SPEAKER_02 (28:10):
Yeah, I desert also has a good reputation of being a
pretty solidly run organization.
SPEAKER_04 (28:15):
So absolutely.
SPEAKER_02 (28:18):
Now, a lot of parents would be terrified at
the idea of giving a kid acredit card, right, Christine?
SPEAKER_01 (28:24):
A credit card, yes, but a debit card, no.
SPEAKER_02 (28:26):
No, no, debit card, that's that's what I'm getting
at.
Credit card, you know, creditcard has a limit 500 bucks, a
thousand bucks.
Well, you know, the kid goes outand buys a thousand bucks worth
of baseball cards today.
And who's gonna wind up payingfor it?
You're gonna pay for it.
SPEAKER_01 (28:39):
I mean But we've seen a lot of success.
It it is way different today.
We've seen a lot of success.
We do most of our high schoolstudents start off with a shared
secured card, which the parentwill put on deposits, say$500,
and then you have a$500 limit ora thousand or two thousand,
whatever you know it might be.
We actually see very responsiblebehaviors with those credit
(29:01):
cards.
SPEAKER_02 (29:03):
Kids today are really weird.
SPEAKER_01 (29:07):
I think they're hearing, I think maybe there's
some things that resonate.
Maybe they heard about the 80sand all the things that happen
with the credit cards in the80s.
So they have at least an earopen.
And they also want to build goodcredit.
So when we give credit cards andwe teach about credit and usage
of credit and what it means tobe optimal, kind of like I don't
want to say gamification, but ifyou want that high credit score,
(29:28):
you have this credit card,here's how you're gonna get that
highest credit score.
They see that as an opportunity.
And so they uh for the mostpart, they are very cognizant of
how they're going to get there.
And now they get such goodfeedback so quickly to see if
they're on track.
So they know about usage.
They know if they get the creditcard, 30% is only what they
should spend on the credit card,that they need to keep that
(29:48):
available credit because itaffects their credit score.
We're teaching them.
It's in the modules that we havein products like Nuvia.
And they know that, and theyactually are thriving more
because of it, I believe.
And they run less into thosemistakes that their parents
probably did make and may stillbe making.
SPEAKER_02 (30:05):
How's it how's it branded?
Is it is it Nuvia or is itCardinal or what?
SPEAKER_01 (30:11):
That's the beauty of this product.
So it's branded, ours is brandeda cardinal card.
So when you get it, you'reseeing Cardinal, it's more
branded Cardinal, which makes itso special, and then powered by
Nuvia.
So we can we give we can givethe partnership the attention
and recognition that hey, we'repartnering with this great
company that allows us to havethe engine to do this, but
(30:33):
you're seeing the face ofCardinal.
When you're going in the app andwe're using your card, it's all
cardinal branded.
SPEAKER_02 (30:39):
Now Marcel wants to leave me.
My heart is broken.
But uh but at least you're notleaving mad.
At least you're not leavingMatt.
That's it's what it's it's whenthe guests leave Matt, I guess.
Oh well.
SPEAKER_04 (30:52):
All good.
Yeah.
It's actually with uh with uh afriend of ours, deserved
financial, or actually having asimilar discussion with them.
SPEAKER_02 (30:58):
So super thank you for your time, Marcel.
Always a joy to talk to you.
SPEAKER_04 (31:03):
Absolutely pleasure, Robert.
SPEAKER_02 (31:05):
So, what else are you going to tell me, Christine,
about about your youth banking?
SPEAKER_01 (31:09):
I will say that the I just want to just reiterate
the branded card because I thinkthat's pretty special that we
could have the cards.
So that's why we can havedifferent cards.
We can have the little browniescard, we can have the Cardinal
card, we can have the ClevelandCrunch card.
I think that makes it fun andinteresting for the youth.
And really, I think we'vecovered everything that I wanted
to make sure we had in thereabout that, especially with the
(31:32):
parents being able to engage ashow much or how little they
want.
And the fact that Nuvia isgrowing up as a company.
I think that's fantastic.
It's not just for one segment.
We can now have an offering andbe in this space within the same
app.
The look and feel is the same,but address it a little
differently for each age group,which I'm very excited about
(31:52):
because, like I said, the olderones are now, the older uh
students are now looking moreabout credit.
And then once they're graduatingfrom college, they're looking
more back into the budgeting.
I remember something, but now Ireally have a concrete example
of what I need to do at a muchlarger scale.
And being able to walk throughthrough that with them with the
journey is great.
And they put a lot into theproduct.
(32:13):
So the look and feel of it is somodern, simple, clear, really
nice to be able for us to beable to deliver to our members
just as the other credit unionsare as well.
And allowing credit unions, youknow, we collaborate, credit
unions collaborating, allowingus to be in this space so we can
be equally competitive for ourmembers in the future.
SPEAKER_02 (32:36):
Before we go, think hard about how you can help
support this podcast so we cando more interviews with more
thoughtful leaders in the creditunion world.
What we're trying to figure outhere in these podcasts is what's
next for credit unions.
What can they do to really,really, really make a difference
in the financial scene?
Can't all be mega banks, can it?
(32:58):
It's my hope it won't all bemega banks.
It'll always be a place forcredit unions.
That's what we're discussinghere.
So figure out how you can help.
Get in touch with me.
This is RJ McGarvey atgmail.com, Robert McGarvey
again.
That's RJMegarvey at gmail.com.
Get in touch, we'll figure out away that you can help.
We need your support, we wantyour support, we thank you for
(33:21):
your support.
The C U 2.0 Podcast.
Welcome to the CU2.0 podcast.
SPEAKER_00 (00:05):
Hi, and welcome to the CU2.0 podcast with big new
ideas about credit unions andconversations about innovative
technology with credit union andfintech leaders.
This podcast is brought to youby Quillo, the real-time loan
syndication network for creditunions, and by your host,
longtime credit union andfinancial technology journalist
(00:27):
Robert McGarvey.
And now, the CU 2.0 podcast withRobert McGarvey.
SPEAKER_02 (00:35):
Here's a fact youth banking is the entry ramp into a
credit union.
Fact two, credit unions, most ofthem will admit that youth
banking is not exactly theirstrongest suit.
Enter Cardinal Credit Union, amentor, Ohio-based institutions
with assets around$335 million,where CEO Christine Blake says
(00:56):
they are winning big andattracting youth to get credit
union accounts by doing a lot ofinnovative thinking and mixing
in fun activities.
Blake, by the way, is a pastpodcast guest in episode 342.
There's a link to that in theshow notes.
She talks about theinstitution's relationship with
the Cleveland Browns and thecredit union's little brownies
debit card and the kids.
(01:18):
Since then, she's turned toNuvia, formerly InSen, or
President Marcel King, and teamhave developed a range of youth
banking tools and ideas.
King too is a past podcastguest.
He was on episode 360 withPioneer Federal Credit Union EVP
Tracy Miller, where they talkedabout youth banking.
On this episode, King and Blakedive more deeply into what youth
(01:41):
banking is about andspecifically what Cardinal is
offering, why kids like whatthey see, and why all of this
matters in helping to ensure acredit union's long-term
success.
In the process, King sharescompelling data on youth banking
at Desert Financial, a bigcredit union in Phoenix,
Arizona, that's getting someterrific results.
Listen up, you'll hear thenumbers.
(02:04):
You know, what I was looking atyour website, one thing that you
have that intrigues the hell outof me is uh what's this madness
game where Oh the Mad City?
Mad City, yeah.
Tell me about that because yeah,and what age group is this for?
SPEAKER_01 (02:23):
That we do it mostly for our high schools.
It it can be any age group.
It could be middle school andhigh school.
There's different versions ofit.
SPEAKER_02 (02:31):
I I wish I'd had a class like this when I was a
senior in college.
SPEAKER_01 (02:36):
I love this one.
This this version that we do forhigh school, we turned it into a
competition because we weretrying to find a way to award
scholarship dollars and not makeit so much on the traditional
grade point average essay.
And so we wanted something alittle bit different that was
more inclusive to everyone.
So we were using this in ourteaching, and then we thought,
(02:58):
you know what, let's turn itinto a game.
So basically, what you do is youget a job, you get a person, and
then you get a family, andeveryone's everyone's different,
and you get a job and a salary,and then during the game, you
have to go buy your house, yourtransportation, your extras.
(03:19):
And then the goal is at the endfor us, you have to come within
a certain dollar amount.
And then if you're not doing itas a game, you're trying to just
teach overall money management.
And so we do it in teams as wellto make it more fun for the
students.
So we do it in teams of three orfour, and then collectively
their average has to equal X.
(03:39):
So it is so it is like my bestfavorite day to hear these kids
talk, and every time it's thesame thing.
My I got a bus pass for my, youknow, my wife, and I, you know,
and I got the thetransportation, or we don't need
that big of a house.
And it's so, so endearing tohear them talk about it.
SPEAKER_02 (03:58):
How many, how many children are you as your credit
union touching today?
SPEAKER_01 (04:04):
Oh, I would say over, probably, I would say
anywhere a minimum of 500.
That would be like a minimum,probably over a thousand each
year.
Because we teach each semesterat each of our five schools, and
then we do the Mad City foreveryone at the end of the year,
but each semester we teach aclass.
(04:25):
So we're hitting all thosestudents in addition to being
our student branches at theschools as well.
SPEAKER_02 (04:31):
And this is all under the Dream Chasers label.
SPEAKER_01 (04:37):
No, this is just all under, this is just all under
sort of our high school branchesand and the dream chasers, yes.
SPEAKER_02 (04:44):
Marcel, let's cut to you.
Why the name change?
SPEAKER_04 (04:48):
Oh, great, great question.
Um, so when InScent was created,uh, it was created specifically
for youth banking, right?
And the actual concept, I thinkRichard Logan, when he started
the company, was he wanted toprovide a way to incentivize his
kids to do chores and do tasksand things on that line.
And so he used the word uhincent as the kind of technology
(05:11):
and the platform.
Uh yeah, after the uhacquisition, uh, you know, what
a key difference between just ayouth banking strategy versus
what we wanted to do, which wasmore of a lifecycle banking
strategy.
Uh, we wanted to associate thename to be more related to the
vision and the strategy of thecompany.
(05:32):
So Nubia uh is a concatenationof kind of new, which is you
know, NEW, and via, which ispast.
So kind of a new path tobuilding lifelong relationships
is the kind of background on uhthe name Nubia.
Uh and so that's that's what wedecided we wanted to do and
execute on was you know create alifecycle banking product
(05:53):
starting with the youth uh andtherefore uh Nubia.
SPEAKER_02 (05:57):
Now, Christine, what what's in it for the credit
union to reach out to kids?
SPEAKER_01 (06:03):
Oh, there's so there are so many advantages and
opportunities reaching out tothe kids.
The first being, I mean, westarted, as you know, as a
schools teacher credit union,which anyone could belong to our
credit union now.
So we've always had a commitmentin financial education.
So the first is we found thatthe market, the earlier you get
(06:23):
education financially to people,the better off they will be over
time.
So that is the big motivation isto make sure that we are walking
with their very, very similar tohow Marcel said, we are walking
them through the life cycles,and the life cycle has been very
early.
It's not now where you open anaccount for your child and put
some money in it and leave it.
These these young people areactive and they're active at a
(06:46):
very early age.
And after we saw the whole2008-9 crisis, we realized how
much education had been lackingin this younger age group.
So that's where we started withthe high schools, and then we
slowly moved down, you know, tothe middle school children.
So that's the reason why isbecause we feel that people will
be better off.
And if we're the partner,honestly, that walks through you
(07:08):
through life, you're you're mostlikely to give us a first look.
So when you're gonna go get yourauto loan or your car loan, or
maybe you want information inthat buying process and you want
to talk to somebody, or you wantit digitally, you're probably
gonna be more put more emphasison someone that you've worked
with before.
And so we want to be thatpartner that's been alongside
(07:29):
you your whole journey.
SPEAKER_02 (07:31):
You you said it's relationship with kids to to the
institution are different, it'sdifferent from what it was years
ago.
And that reminds me when when Iwas a little kid, maybe six
years old, my father took me toan SNL and put some birthday
money in it.
20 bucks.
I don't heck of a lot of money.
And um I don't remember thatanybody put any more money in
(07:55):
it.
I do remember when I was 21, Iwent and withdrew what was in
it.
And it wasn't a heck of a heckof a lot of money.
It was like$21 at that time.
It was something like that.
And if you said, I'll give you athousand bucks if you could tell
me the name of the institution,I'd say, No, you win.
I don't know, I don't remember.
It's I just knew I had thislittle savings passbook.
SPEAKER_01 (08:18):
Oh, that's exactly.
And it's about adapting tochange and meeting people where
they are.
Remember the passbooks?
When I I started in 2010, Ifound some old passbooks where
you used to put the quarter in,you know, you put the quarter
and then you bring the wholepiece into foot into your
account.
I I don't think most kids arelike even touching money very
much anymore.
unknown (08:38):
Yeah.
SPEAKER_02 (08:38):
Well, that's one of the key differences, is that a
lot of kids don't get any money,and but they do get a debit card
credit from a parent orsomething.
SPEAKER_01 (08:47):
Right.
And that's what's so beautifulabout this product.
Uh, and I as soon as I saw it,like that's what's so beautiful
about it.
I'm just so happy that Nuvia hasnow, that insects, you know, now
Nubia, because of what they'reable to do, is exactly that now
you're educating them in thesame way.
It's just not the same way, it'sdifferent, but it's actually the
(09:08):
same.
It's the concept of money, it'sthe concept of why you're
saving, what's important aboutsavings.
And your parent can walkalongside you, which is also
great.
I mean, one of the greatfeatures, and this is a really
fun feature, there's a there's afeature in there where you can
do a loan to your child and showthem like what it would be like
to pay interest back when you'reborrowing money from your
(09:29):
parents, not just always we'regiving you money or you're not
just always earning it forshorts.
That part teaches you what it'sgonna be like later on when
you're going to get a car loan,home loan, or anything else you
might be financing, but you'relearning that concept very
early, again, with you know, nocost to you essentially, because
you have the learning experienceand you're not gonna go wrong uh
(09:50):
very big at all.
SPEAKER_02 (09:52):
Now, Marcia, you just got a rave review.
So tell tell me about theproduct.
Tell me about the product.
What's Christine raving about?
SPEAKER_04 (09:59):
Yeah, if you think about today, most credit unions
have youth accounts.
Either they start with a savingsaccount, some have teen checking
accounts, um, and or and orboth.
And so when you start thinkingabout that uh and how those
consumers, that demographicengage with your institution, if
(10:20):
it's just a savings account,they're never going to engage.
If they get a checking accountwith a debit card, they get a
debit card, but they're notreally learning anything by just
getting a debit card unlesstheir parents start teaching
them or they take a financialeducation class in high school,
whatever it may be.
So what we're doing with Nubia'syouth banking product is
(10:41):
coupling financial educationwith real money application,
right?
So, yes, you can learn aboutsavings, but then you can go
actually build a savings goal,right?
Or you can learn about uh youknow loans and then your parent,
you can borrow money from yourparents or uh or budgeting,
right?
So we're we're really taking thetwo things that need to be
(11:02):
applied together to actuallyunderstand how those kids'
behaviors change.
Because if you think about justthe financial education side,
and I've talked to hundreds ofinstitutions, I asked them, how
do you measure the success ofyour financial education
program?
The traditional answers are uhparticipation, right?
So I had 20 kids.
(11:23):
Uh, it could be a test at theend, like here are the concepts
that you learned, and there'syou know, multiple choice, et
cetera.
But what I haven't been able tofind with any institution is
okay, how are you measuring theimpact of the behavior to know
that this is actually working,right?
Because if you think aboutfinancial literacy in the US,
57%, only 57% of the consumersin the US households are
(11:46):
considered financially literate.
And that has stayed prettyconsistent over the last 50
years, right?
So although we're providingeducation, understanding how
effective it is is verydifficult.
So we we see the opportunity toactually tie those two things
together with the kind of thesix big modules that we have,
which is you know, the financialeducation, that's learn.
(12:07):
There's earn, which is beingable to teach your kids about
earning money, right?
So giving them a task to do,paying them their allowance,
paying them for grades, um, youknow, so you can you know
basically give themopportunities to earn money.
Uh, and then you have the spendside, which is now they have a
debit card that they canassociate with that money, and
they're now understanding, hey,if I spend 10 bucks on this,
(12:29):
that means that I'm gonna havezero left in my account to buy
something else, right?
Uh, there is a give module, acharitable giving module, so
that kids can learn aboutcharitable giving.
Uh, there is a uh savings bucketwhere a kid can actually save up
for whatever they may want orneed down the road.
It could be a bike, it could bea skateboard, the next video
(12:50):
game.
Uh, but as Christine mentioned,the kind of the crowd favorite
is the parental lending modulewhere you can loan money to your
kids and apply interest rates tothat, uh to that loan and teach
them about uh credit and theimpact of interest when you're
borrowing money.
So those are the big modules,and we're trying to make sure
that we tie those together sothat kids are basically building
(13:12):
better money habits uh earlierin their life so that as they
you know get to college, theydon't go and immediately go
apply for a credit card and thennever pay it because they've
understood what it means toactually make the payments on
the cards and and the loans thatyou're doing.
So that's that's the primarygoal.
It's really just to apply thefinancial education to actual
(13:33):
real money applications to teachkids better financial money.
SPEAKER_02 (13:38):
How willing are parents to be open about the
family finances with kids?
And I say in my family, I I haveno idea how much my parents
made.
No idea at all.
Were we middle class, uppermiddle class, uh lower middle
class?
We were one of those classes.
I know that.
We weren't rich, we weren'tpoor, but somewhere in there.
(14:01):
But I couldn't tell you whichone we were.
Uh we never we never talkedabout money, and money is seemed
like a bottomless resource.
Not that we were rich, but youknow, I asked my mother for five
bucks, she gave me five bucks.
She didn't say, now don't askagain for 10 days.
She never said that.
SPEAKER_03 (14:18):
You should have, probably.
I had to work for I had to workfor mine, Robert.
I had to mow lawn, go wash acar.
SPEAKER_01 (14:24):
Yeah, I'm not sure it's a lot different in what the
families, you know, families areunique and families share
differently.
I think it's more about thefamilies sharing and talking
more about either what allowanceyou're getting, what you're
earning, and how you're gonnaspend your portion than here's
what I pay for my mortgage.
No, here's what you are making,here's what you might be
(14:45):
earning, and what within thatcapacity can you afford to do?
And again, like these buckets,you're gonna afford X amount.
Are you gonna save some of that?
Are you gonna give some of that?
So I think it's more about theparents having the conversation
and the ability also to have itdigitally, which is faster and
quicker, and how most youngpeople respond, so that you're
getting that piece of it so thatby the time you are more
(15:09):
educated and as you grow older,you'll you'll figure out where
you where your family might be,you know, economically, but all
the while it really doesn'tmatter in the sense of you're
learning how to manage what yourincome is, so to speak.
unknown (15:24):
Yeah.
SPEAKER_04 (15:25):
And and let me let me just to kind of give you some
perspective on kind of howthat's applied within the
experience, the parent isopening up an account
specifically for that kid,right?
Where the money is going to gointo that account.
So anytime the kid um, you know,if even if they start a job,
right, they still have anaccount, it's a primary checking
(15:45):
account.
The parent is a joint owner inthat account, so that allows
them to still control theaccount and but move money into
that account.
But the kid can also receivemoney into that account from
grandma or Uncle Joe, whomeverit might be.
So they have a real checkingaccount.
They may not call it a checkingaccount, some call it a spend
account.
And now they have a debit card,right?
So to Christine's point, it'sabout how do you help that kid
(16:09):
understand how they need to earnmoney and what does money mean?
I had a 14-year-old uh niecethat uh stayed with us for a
little while, and she had noconcept of what money meant,
right?
She just saw me swiping card,right?
Uh, and so anytime we gosomewhere, she'd ask something,
you know, ask for something, andI'd say, okay, well, do you know
how much does this cost?
Well, what does that mean?
Right.
So it's it's trying to createthat relevance of what money
(16:31):
means and how does it um helpyou, and also how can it also
hurt you if you're doing thewrong things with it.
Um, so to Christine's uh um uhyou know comment, it's not
necessarily about what I earn asa parent.
It's how do we teach you whatthat means and what money means
and how do you actually manageit so that it helps you benefit
yourself and your family andothers uh as opposed to just you
(16:54):
know spending it willy-nillywithout even thinking about you
know what you're actuallyspending on.
SPEAKER_02 (16:59):
The important thing is learning that money is
finite.
Yes, even for Elon, even forElon Musk.
You hit it on the hand finite.
Yeah, his finite is a lot biggerthan mine, but it's finite for
him.
It's uh and that's that's alesson that's hard for a kid to
absorb.
Uh I I geez, I probably was 21before I absorbed that lesson.
SPEAKER_01 (17:22):
And I think too, it comes at different points, is
like I said, when they're readyto absorb.
So for example, another anotherneed that we found is we have a
lot of high school studentsgraduating, you know, to
college.
Then they may have theiraccounts with us through
college.
Then when they're out of collegeis usually when they have their
first, you know, first, first orsecond job, sort of like their,
(17:43):
you know, their sort of grown-upjob.
They have that job and nowthey're going to be living on
their own.
So they have different things toconsider that they didn't have
to before.
Okay, now I have to figure outhow much do I spend on an
apartment or where do I live, ordo I have to buy a car and car
insurance now?
So there's a whole nother pointof budgeting differently at that
age group.
And one of the nice things aboutthe Dream Chasers is it's now
(18:05):
structured in a product that canhelp you through life's journey
versus just at one point intime.
And that's a great addition thatthey're bringing uh to the
product, which I think isfantastic.
SPEAKER_04 (18:17):
Yeah, and then that really kind of ties back to that
life cycle banking, right?
So you think about asix-year-old, what might a
six-year-old use in thisapplication?
When it's, you know, it'sdigital, they get to create
their own little avatar.
Generally, it's going to besomething along the lines of
savings account, understandingwhat savings is, how do you
actually save money?
What does it mean?
And how does it help youaccomplish your goals?
(18:38):
Uh, and and potentially,depending on the institution and
the parent, maybe a debit card,right?
Because now they may want to gobuy their next doll or a toy or
whatever it may be, but at leastnow you're showing them that,
hey, you had$20 here, you paid$5for your toy, this is what you
have left.
It is this is finite.
So you got to think about how doyou want to save or spend this
(19:00):
money based on what yourlonger-term goals are.
Uh, and then as you uh age, likea teenager, it's probably more
of the uh capabilities andfeatures that are going to be
used, obviously the debit cardwith penal parental controls,
but also that budgeting, right?
So you start thinking aboutteach teaching the kid about
budgeting so that as theyprepare to move off to college
or their first job or on amission or whatever it may be,
(19:22):
that they need to budget theirmoney.
But you're able to teach themthat within that application uh,
you know, earlier than you know,later, right?
So it gives that parent anopportunity to help teach the
kid, hey, here's how you need tothink about budgeting the money
that's coming in with the moneythat's going out so that you
don't uh you'll have your billsturned off or your phone turned
(19:43):
off or get kicked out of yourapartment or whatever it may be.
SPEAKER_02 (19:46):
Now, do do kids today understand cash money?
SPEAKER_04 (19:53):
Understand cash money.
I I yes, I I if if their parentsare teaching them about cash and
they actually understand what itmeans to earn, you can teach
them about the cash moneybecause and I'll go back to my
14-year-old niece.
You know, I gave her five bucksfor, you know, I'll call it
washing the car or whatever itmay have been, and she wanted to
pie a buy a pack of gum, right?
And nowadays you can't buy gumfor you know 25 cents anymore.
(20:17):
It's like you know, three bucksfor 15 pieces of gum, right?
This is terrible news, Marcel.
How can you share this?
Yeah, so but but here's here'sthe point.
I said, okay, here's your fivebucks.
The gum is three dollars.
That means that you're onlygonna have two dollars left.
So do you really want to buythis gum or do you want to save
this money for you know the thedoll that you wanted, which is
(20:38):
you know, 50 bucks, right?
And uh she thought about it fora minute.
She's like, okay, I'm gonna skipthe gum, right?
And she came to five bucks,right?
But that was an opportunity toteach her about this is the
value of money, it is finite,and you need to be thinking
about what are you trying toaccomplish, what are your goals,
what do you really want versusuh what do you need versus what
do you want at this time, andand actually you know kind of
(21:00):
holding on to that money for alittle bit longer.
SPEAKER_02 (21:02):
Now, can your app do what you just did with that with
that girl?
In other words, what you weredoing was you were acting like a
coach.
You're saying, here's someoptions here.
Here's here's your reality, thisis what you got, and you want to
do this, but then you can't dothat.
Now can the app do that?
Because I mean that's great.
That's great teaching.
(21:23):
Yep.
SPEAKER_04 (21:23):
So there are there are two components to the app,
uh, and Christine may have, uhI'm sure we'll have some
additional insight on this.
Is number one, the kid can setup for a savings goal, right?
So if they have a savings goal,they can look at their savings
goal and see how far along theyare in that goal.
So if it's a$20 for a doll uhand they have$5 in their
(21:46):
account, they can see, okay, Ineed$15 more dollars, right?
So that's one component of it.
The second piece is that theycan see their balance in their
accounts.
So they can open up their phone,they can look at a balance and
see that they have$15 in theiraccount and they're looking to
purchase something that's$5.
You know, again, simple math.
Okay, if I spend this five now,that means now I'm$20 less than
(22:07):
what I need to do to get mydoll.
So those components are kind ofbuilt into the system so that
they can see what their balancesare, they know what they're
spending, and they can determineif they want to actually buy
something based on what's intheir account and what they're
looking to do longer term.
Chris, can you anything to addto that?
SPEAKER_01 (22:24):
I would say, and vice versa, the other way too,
you can approve transactions.
So the other the other flip sideof it is that you're going to do
a transaction and you have itset up to approve over X dollar
amount.
The parent sees that and goes,okay, you're not spending, you
know,$30 today on X.
I could see where you are.
You know, I might be denyingthat transaction, and then I
might be sending you a message,hey, you know, that's a little
(22:45):
out of your range.
Look at what you have, and youcould send the message back and
use those as teaching momentstoo.
So that's another way that theapp works in a different way,
but basically accomplishing avery similar goal.
SPEAKER_02 (22:57):
Christine, how do how do you keep the kids
engaged?
Yeah, it's that it's you know,kid hits the first obstacle and
then says, ah, hell, I don'tlike this game anymore.
It's you know, it's not workingfor me.
SPEAKER_01 (23:10):
I will say it is a constant challenge.
You know, anytime you're wickingwith the youth and trying to
understand, you know,generationally what motivates
them.
We're very fortunate because wehave advisory council, we have
our high school students, wehave middle school students, so
we get to engage and see whatthe buttons are, so to speak.
You know, what incentives getthem to react, what games get
(23:32):
them to react, and what trulymotivates them?
It's different across the board,but it is constantly changing.
It's just a matter of us stayingup on top of it and having the
tools like this that we wealready have in place.
Now, how do we use them a littlebit differently to keep them
engaged?
And sometimes maybe it's justtrading up.
You might find out, oh, here'sthe content.
So, for example, we took out, weoriginally had crypto uh content
(23:55):
and and modules in in the app.
And then we took them out, youknow, a couple years ago because
it was all no crypto, everythingwas you know very bad about
stable coin now.
It's all like you got to get itback in as fast as you can.
So it's also about what keepsthem engaged is making sure that
you have the relevant contentthat they're looking for at that
point in time.
(24:15):
So that's a piece of it that Ithink keeps them engaged.
SPEAKER_04 (24:19):
And I think the there's another piece of this is
really around kind ofgamification.
So one of the ways that we tryto drive engagement with the
kids is through thisgamification, in which if they
complete a specific goal, sothey set up Sami's goal and they
achieve their goal, they get atrophy.
If they uh watch a particulareducational module, they get a
(24:41):
trophy, right?
So we're giving them trophies,and within that family, if there
are more than if there's morethan one kid, you can see your
number of trophies versus othermembers in the family.
Uh, and then across the entirecredit union, you can see your
ranking.
You don't necessarily see otherkids' names, but you can see the
ranking where you kind of sit uhin that space.
(25:01):
So you know, trying to leveragegamification as a way to drive
uh engagement beyond just themjust spending and you know
earning the money, right?
SPEAKER_01 (25:10):
And good behaviors that are fun.
I mean, they find that fun.
It's the world that they'regrowing up in.
And then when it's fun andengaging, they're more likely to
then continue on those behaviorsthat help them in the future.
SPEAKER_02 (25:25):
Now, is this bringing more families into the
credit union, Christine?
SPEAKER_01 (25:30):
Yes, I would say yes, because a we we have this
program and we have our littlebrownies debit card within this
program as well.
You can have any debit card, youcan have our little brownies
debit card, you can have regularcardinal debit card.
We're getting to launch a fewdifferent ones too.
So we have this selection ofcards to use.
They all work the same withwithin within the module.
(25:52):
And each opportunity is nowwe're getting exposure to a new
group of people and showing themwhat we have.
Now we have this debit card,kind of like what Marcel said.
We're not just giving you acredit card or a debit card,
we're giving you this with allthese tools.
And so as we're introduced toall these new groups, they're
now seeing the value in thisproduct for their children.
SPEAKER_04 (26:12):
Yeah, I have some data.
Uh so one of our credit unionsum is uh fairly um uh they're
all in on youth banking, desertfinancial out of Phoenix,
Arizona.
They're about 9 billion inassets, and we did a case study.
Uh, and here are a couple ofkind of key data points to the
to the question that you'reasking.
Adoption rate amongst theexisting youth accounts reached
(26:34):
30% in the first six months.
So they have a 30% adoption ratewithin their existing youth
accounts.
They have acquired, increasedtheir number of youth accounts
by 32% over that six months.
Uh, they have increased thelevel of deposits 22% increase
in deposits over that six monthsacross all of the youth
(26:55):
accounts.
So you're looking at kind of theone element of engagement that's
retention, uh, acquisition ofadditional youth accounts, but
it's also acquiring new parentswho were never members at the
institution to open up accountsbecause of this uh kind of call
it the you know youth bankingexperience.
So now you know a parent whocomes in with three kids has to
(27:17):
open up four accounts, right?
Their own, where the money isgoing to move into to that
parent or uh into the parent'saccount from the kid when
they're borrowing money.
Um, and so there's thatinteraction.
But you know, it's it's drive, Ibelieve Desert was somewhere in
the two to three percentincrease in net new members
because of this, uh, because ofthis service being offered in
(27:38):
their community.
And right now they're the onlyone in the kind of Phoenix area
to offer this service, and theyare heavily promoting it, which
is driving that level ofadoption, engagement, uh, and
member acquisition.
SPEAKER_02 (27:51):
Well, I think they're one of the, I live in
Phoenix, they're one of thebiggest credit unions around
here.
And I'm surprised other creditunions aren't looking at their
success, saying, I gottaoptimize bus too.
SPEAKER_04 (28:03):
So we do have some prospective clients that are in
the Phoenix area that are nowlooking to launch Phoenix
banking.
SPEAKER_02 (28:10):
Yeah, I desert also has a good reputation of being a
pretty solidly run organization.
SPEAKER_04 (28:15):
So absolutely.
SPEAKER_02 (28:18):
Now, a lot of parents would be terrified at
the idea of giving a kid acredit card, right, Christine?
SPEAKER_01 (28:24):
A credit card, yes, but a debit card, no.
SPEAKER_02 (28:26):
No, no, debit card, that's that's what I'm getting
at.
Credit card, you know, creditcard has a limit 500 bucks, a
thousand bucks.
Well, you know, the kid goes outand buys a thousand bucks worth
of baseball cards today.
And who's gonna wind up payingfor it?
You're gonna pay for it.
SPEAKER_01 (28:39):
I mean But we've seen a lot of success.
It it is way different today.
We've seen a lot of success.
We do most of our high schoolstudents start off with a shared
secured card, which the parentwill put on deposits, say$500,
and then you have a$500 limit ora thousand or two thousand,
whatever you know it might be.
We actually see very responsiblebehaviors with those credit
(29:01):
cards.
SPEAKER_02 (29:03):
Kids today are really weird.
SPEAKER_01 (29:07):
I think they're hearing, I think maybe there's
some things that resonate.
Maybe they heard about the 80sand all the things that happen
with the credit cards in the80s.
So they have at least an earopen.
And they also want to build goodcredit.
So when we give credit cards andwe teach about credit and usage
of credit and what it means tobe optimal, kind of like I don't
want to say gamification, but ifyou want that high credit score,
(29:28):
you have this credit card,here's how you're gonna get that
highest credit score.
They see that as an opportunity.
And so they uh for the mostpart, they are very cognizant of
how they're going to get there.
And now they get such goodfeedback so quickly to see if
they're on track.
So they know about usage.
They know if they get the creditcard, 30% is only what they
should spend on the credit card,that they need to keep that
(29:48):
available credit because itaffects their credit score.
We're teaching them.
It's in the modules that we havein products like Nuvia.
And they know that, and theyactually are thriving more
because of it, I believe.
And they run less into thosemistakes that their parents
probably did make and may stillbe making.
SPEAKER_02 (30:05):
How's it how's it branded?
Is it is it Nuvia or is itCardinal or what?
SPEAKER_01 (30:11):
That's the beauty of this product.
So it's branded, ours is brandeda cardinal card.
So when you get it, you'reseeing Cardinal, it's more
branded Cardinal, which makes itso special, and then powered by
Nuvia.
So we can we give we can givethe partnership the attention
and recognition that hey, we'repartnering with this great
company that allows us to havethe engine to do this, but
(30:33):
you're seeing the face ofCardinal.
When you're going in the app andwe're using your card, it's all
cardinal branded.
SPEAKER_02 (30:39):
Now Marcel wants to leave me.
My heart is broken.
But uh but at least you're notleaving mad.
At least you're not leavingMatt.
That's it's what it's it's whenthe guests leave Matt, I guess.
Oh well.
SPEAKER_04 (30:52):
All good.
Yeah.
It's actually with uh with uh afriend of ours, deserved
financial, or actually having asimilar discussion with them.
SPEAKER_02 (30:58):
So super thank you for your time, Marcel.
Always a joy to talk to you.
SPEAKER_04 (31:03):
Absolutely pleasure, Robert.
SPEAKER_02 (31:05):
So, what else are you going to tell me, Christine,
about about your youth banking?
SPEAKER_01 (31:09):
I will say that the I just want to just reiterate
the branded card because I thinkthat's pretty special that we
could have the cards.
So that's why we can havedifferent cards.
We can have the little browniescard, we can have the Cardinal
card, we can have the ClevelandCrunch card.
I think that makes it fun andinteresting for the youth.
And really, I think we'vecovered everything that I wanted
to make sure we had in thereabout that, especially with the
(31:32):
parents being able to engage ashow much or how little they
want.
And the fact that Nuvia isgrowing up as a company.
I think that's fantastic.
It's not just for one segment.
We can now have an offering andbe in this space within the same
app.
The look and feel is the same,but address it a little
differently for each age group,which I'm very excited about
(31:52):
because, like I said, the olderones are now, the older uh
students are now looking moreabout credit.
And then once they're graduatingfrom college, they're looking
more back into the budgeting.
I remember something, but now Ireally have a concrete example
of what I need to do at a muchlarger scale.
And being able to walk throughthrough that with them with the
journey is great.
And they put a lot into theproduct.
(32:13):
So the look and feel of it is somodern, simple, clear, really
nice to be able for us to beable to deliver to our members
just as the other credit unionsare as well.
And allowing credit unions, youknow, we collaborate, credit
unions collaborating, allowingus to be in this space so we can
be equally competitive for ourmembers in the future.
SPEAKER_02 (32:36):
Before we go, think hard about how you can help
support this podcast so we cando more interviews with more
thoughtful leaders in the creditunion world.
What we're trying to figure outhere in these podcasts is what's
next for credit unions.
What can they do to really,really, really make a difference
in the financial scene?
Can't all be mega banks, can it?
(32:58):
It's my hope it won't all bemega banks.
It'll always be a place forcredit unions.
That's what we're discussinghere.
So figure out how you can help.
Get in touch with me.
This is RJ McGarvey atgmail.com, Robert McGarvey
again.
That's RJMegarvey at gmail.com.
Get in touch, we'll figure out away that you can help.
We need your support, we wantyour support, we thank you for
(33:21):
your support.
The C U 2.0 Podcast.
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