NEW YORK and LANSING, Mich. (12/2/13)--Save to Win, the prize-linked savings program that encourages non-savers to get into the habit of saving, gained some exposure in national feature stories on PBS and ABC News last week.
ABC News, in "Here's a Lottery You Cannot Lose," (Nov. 27) reported that 68 credit unions in four states offer the program and that there is federal legislation pending that would allow banks to also offer them. It noted the accounts don't encourage risk, but rather promote saving. The number of accounts have increased to 17,000 since 2009, when 11,700 accounts were counted.
The program was developed by the Michigan Credit Union League, in collaboration with the Filene Research Institute and the Doorway to Dreams Fund, said the report. Doorway to Dreams promotes financial opportunity for low and moderate income consumers.
Sharon Hall, CEO of Seattle-based Express CU, told ABC News the credit union began offering the accounts in 2010 because it serves low-income consumers and there was a benefit to offering an "incentive win component." Winners take the money and reinvest it, in hopes of winning a larger prize.
PBS featured a similar story Nov. 23, said the Michigan league, and that story was trending last week on Digg.com (Michigan Monitor Nov. 25).
In Save to Win accounts, account holders earn entries into monthly and annual cash prize drawings for every $25 they deposit. All funds deposited into the accounts, including interest earnings, belong to the account holders.
The program appeals to unbanked and under-banked consumers. Maryland, Michigan, North Carolina and Washington are among the states that allow credit unions and other institutions to offer the products.