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News Now

CU System
CUs gift cards strong despite retail sales dip
SPRINGFIELD, Ill. (12/31/08)--The Illinois Credit Union League (ICUL) Service Corp. sold nearly the same amount in gift cards as it did last year, despite a nationwide dip in holiday retail sales. ICUL Service Corp. sold about 600,000 cards, Karen Duffy, senior vice president, told News Now. The strong card sales are likely due to more credit unions offering gift cards to members. Members are asking for the cards, and credit unions “want to offer that financial service,” Duffy said. “Our gift cards did great.” The minimum amount required on the cards sold by ICUL is $10, while the maximum is $500. The average amount for the cards this year was $80, Duffy said. ICUL Service Corp. worked to educate credit unions about the difference between open- and closed-loop gift cards because of concerns some consumers had, she said. Closed-loop cards only can be used in the store where they were purchased. Open-loop gift cards, such as those sold by Visa, MasterCard and Discover, can be used anywhere in the world, Duffy said. Some consumers were concerned that stores they purchased closed-loop gift cards in would become bankrupt after the holidays, she said. Regulations in some states have prohibited financial institutions from selling open-loop cards because the cards often have fees tacked onto them or carry an expiration date. ICUL Service Corp. is monitoring regulations for changes in 2009 and how any changes could affect sales, Duffy added. ICUL Service Corp. is a business corporation that provides credit, debit card products, checking, clearing house and loan services to credit unions in Illinois and 45 other states.


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