ST. LOUIS — Credit unions in Missouri are increasingly offering attention-grabbing promotions such as free gas or new mobile apps to win customers in a crowded banking environment.
The St. Louis Post-Dispatch reports that First Missouri Credit Union employees gave out $4,000 in free gas this past week at a south St. Louis County Petro Mart. Cars lined up for hours in advance.
It was part of a larger effort by nearly 40 credit unions and community banks in several states, including Missouri, to persuade people to switch from larger national banks.
Credit unions are nonprofit cooperatives that are owned by their members. Most have opened up their memberships and are no longer restricted to a single industry.
The St. Louis area is a highly competitive banking market, with 49 credit unions and more than 80 chartered banks and thrifts. That doesn't include large banks such as U.S. Bank and Bank of America that operate in the region.
Credit unions and local community banks are seeking to capitalize on an anti-big bank sentiment that gained steam in recent years, driven in part by some large banks' fees.
Membership in First Community Credit Union, the region's largest, has grown to 225,000, a 7 percent increase over last year. The credit union has added locations, including in Walmart stores. In September, the credit union will begin a new promotion that gives customers $100 for refinancing their auto loan from another financial institution.
First Community and other credit unions are also enhancing smartphone access to accounts. The credit union plans to add the ability for customers to deposit checks remotely on their smartphones, starting in October.
"That's really the last piece of the online banking puzzle," said Laura Alfeldt, vice president of marketing. "I think the name of the game is convenience and that's where credit unions have traditionally struggled."
Bridgeton-based Vantage Credit Union also is adding new mobile applications.
"The perception of credit unions was that we were behind the times and that's changing," said Vantage's executive vice president Denise Stevens.
Several St. Louis-area credit unions have started offering a free, high-interest checking account under the Kasasa brand, with a 2.51 percent interest rate on the first $10,000 — far above the national average.
The Missouri Credit Union Association said the state's credit unions' assets rose to $12.1 billion at the end of June, up from $11.8 billion a year earlier. Missouri now has more than 1.44 million credit union memberships, up from 1.39 million a year ago.
Nationally, credit union membership rose more than 2 percent from a year earlier to 97.6 million memberships, according to the Credit Union National Association, an industry trade association.