As millions of students head back to school, many are going with a credit or debit card in hand (some for the first time). Owning a card can be a big responsibility for young adults and unfortunately, when it comes to learning good spending habits, not all are prepared to ace the test.
According to financial counselor Dave Ramsey, more than 80 percent of graduating college seniors have credit card debt “before they even have a job.” Industry data from Sallie Mae found that only 63 percent of college students pay their credit card bill in full each month.
At the same time, young adults are a growing target for card fraud. According to the Federal Trade Commission, 43 percent of consumers ages 20-29 reported losing money to a fraud scheme, which is almost triple the percentage of older consumers.
The good news is that your members and their children don’t have to become one of these statistics. By equipping them with the knowledge and proper tools to manage their cards, credit unions can simultaneously guide members towards better spending habits while reinforcing their primary financial institution (PFI) relationship.
Empowering Members through Self-Service
When it comes to managing their spending, today’s consumers are increasingly shifting toward self-service and mobile channels. A PYMNTS and Ondot survey found that one-third of American consumers are using mobile card services to manage their credit and debit cards. It is worth noting that of the 66 percent that have never used mobile card services, over half were unaware they were available to them.
Mobile card services, like CardNav by CO-OP, allow your members to see exactly when, where and how their cards are being used and then manage their spending. Members can turn their cards on and off, establish spending limits, and receive transaction alerts all in real-time from their phones. In other words: it’s every parent’s dream.
While the idea of transaction monitoring and spending reports might give a college student heart palpitations, in reality it can also encourage them to establish good spending habits on their own. Research from PYMNTS and Ondot found that 92 percent of consumers under the age of 35 use mobile card services to tailor their card usage to their individual circumstances.
““With CardNav, parents gain the ability to monitor their children’s spending, or set permissions any time the need arises,” said Michelle Lemieux, Senior Product Manager for CO-OP. “And both parents and kids appreciate the sense of security and personalized control the app provides.” ”
Another great feature of CardNav that applies to both parents and students is the location-based setting, which allows a cardholder to only authorize transactions within a specific locale (i.e. near their school) or with certain merchant types or categories.
““With card-not-present fraud on digital channels becoming increasingly common and difficult to detect, location settings can be really effective for students on campus,” said Lemieux.”
Activating CardNav at Your Credit Union
As your members are sending their kids back to school, consider arming them with a tool that puts control and security back into their hands. CardNav by CO-OP is available as a standalone application or API solution. To learn more, visit: https://campaigns.co-opfs.org/cardnav/
And for existing CardNav users, there are some helpful member-facing materials available to you within the CO-OP Marketing Portal that you can use to promote CardNav to your members and boost engagement and satisfaction.
The original article Now Members Can Navigate Their Children’s Finances – All From Their Smartphone can be found on Insight Vault.