ING is a sprawling Dutch conglomerate. Athol Credit Union is not. But the $80 million local institution now has something in common with ING – they’ve both launched online-only financial divisions.
Customers at Athol’s recently announced Quabbin Online Credit Union can open a savings account, invest in a certificate of deposit or gain access to money markets, but they can only do it online – similar to ING Direct, an online-only bank with a few more offerings.
The draw for customers lies in favorable interest rates, said Athol Spokesman Shawn Gonynor. With no physical branches, overhead is minimal, so financial benefits are passed along to the customer. For example, he said, a customer walking into an Athol Credit Union branch gets interest rates of 0.6 percent. Quabbin customers get 1.35 percent.
Gonynor said it takes between $1 million and $2 million to build a traditional branch, plus $250,000 a year to operate. The online division, by contrast, cost about 1/10 of that to launch. A call center for the credit union serves to back up Quabbin customers as well.
The name “Quabbin” is intended to draw a wider pool of interested customers, he said. “Athol Credit Union” is a highly localized name, and although the credit union’s membership stretches over Worcester, Hampshire and Franklin counties, the name creates an impression that membership is limited closer to Athol.
But the credit union didn’t want to ditch its 80 years of history by just changing the institution’s name entirely, Gonynor said, so the name “Quabbin” for the new division seemed a good compromise, as it refers to a broader region of north central Massachusetts.
Quabbin Credit Union is open to anyone who qualifies as a member of Athol Credit Union, and Gonynor said the division has begun with a trio of offerings that may expand in the future as it grows.
At first blush, it seems Athol is unique with this particular project. Neither Gonynor nor Credit Union League of Massachusetts spokesman Rob Kimmett could name other local financial institutions launching similar ventures. Lou Fabrizio of Fabrizio/Fortuna, the Watertown-based marketing firm working on the project with Athol, said he’d never heard of another credit union with a similar division.
Fabrizio’s task is to help the credit union get the word out to potential members. The credit union is targeting younger prospects, aiming to reach them through online marketing and direct mailings.
The credit union is also establishing its green credentials by mentioning the online institution’s paperless statements, and a support campaign for the natural environment in the Quabbin region, Fabrizio said.
