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MasterCard exec: CUs 'formidable' competitors
PURCHASE, N.Y. (7/30/14)--Credit unions made the most of their reputation for trust with consumers during the financial crisis, strengthening their credit card portfolios and establishing themselves as "formidable" competitors to big banks, a MasterCard executive said in an interview with PYMNTS.com.
 
Now is the time to redouble their consumer-focused efforts, said Margaret A. Shine, MasterCard senior vice president and group head, segment solutions. 

Shine will speak at this week's World Council of Credit Union's World Credit Union Conference in Gold Coast, Australia.
 
During the financial crisis overall outstanding credit card balances declined 12%, Shine said. Large banks felt the downslide the most, with a 14% decline in credit card balances.  "But the rest of the marketplace, which includes local and community institutions like credit unions, grew this line by 5%," Shine said. "Similarly, when you look at U.S. credit card purchase volume, the market grew by 30% overall. Yet large financial institutions saw only a 26% increase versus a 66% growth rate for the rest of the marketplace."
 
Shine said the need for government intervention and resulting media coverage during the crisis shook consumer confidence and trust in financial institutions, but credit unions mostly emerged from the crisis with solid, unsullied reputations. 
 
Shine said credit unions must now focus on the consumer of the future. That means focusing on the payment trends and applying them to their memberships to stay relevant and differentiated.
 
"Credit unions in the U.S. market did a great job in being formidable competitive players post-crisis; they have built momentum and should continue to do so, redoubling their efforts especially with some strong economic factors to their back," Shine said.
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