PORTLAND, Maine (12/28/11)--As the Dec. 31 deadline looms, credit unions are preparing their members in several ways for the demise of paper savings bonds. After Saturday, paper savings bonds no longer will be sold at financial institutions.
Maine credit unions are helping both members and employees prepare for the change, said the Maine Credit Union League (Weekly Update Dec. 23).
Capital Area FCU, a $22 million asset credit union in Augusta, Maine, said its staff personally contacted members that purchase savings bonds regularly from the credit union to let them know of the change, Diana Winkley, president/CEO of Capital Area told the league. The credit union also posted an announcement on its website, on its Facebook and home banking pages, in its lobby and on its receipt messages.
Five County CU, based in Bath, also said it is using several methods to ensure a smooth transition. The $188 million asset credit union posted a message on its website, and the information is on the home banking message for all users. It also created a flyer displayed at each teller line and is handing out a brochure to its members.
Consumers can purchase electronic savings bonds online through TreasuryDirect, a secure Web-based system operated by the Bureau of Public Debt (News Now Sept. 8). Existing paper bonds are still valid and will earn interest for 30 years from the issue date or until redeemed. The Treasury Department estimated that going electronic would save $70 million in taxpayer funds over five years.
Because savings bonds are popular gifts, credit unions were expecting more inquiries than usual during the holiday season, said the Maine league.
In September, the National Credit Union Administration issued a Letter to Credit Unions (11-CU-15) that provided guidance in answering members' questions. It specifically asked credit unions to educate members about the upcoming changes, stop accepting applications for savings bonds after Dec. 31, and continue to redeem savings bonds. The Treasury Department also has a toolkit to assist in communicating the changes. For more information, use the links.