The program is made possible by a Minnesota law that took effect Jan. 1 that allows financial institutions to raffle cash prizes to customers.
“This is one way to talk to our members on saving for themselves for life’s emergencies,” says Dana Garrett, president and CEO of North Memorial Federal Credit Union, which is one of 14 credit unions participating in the state. “When you look that it is a no-risk factor, it’s a no brainer.”
How it works
If you deposit $25 a month into a Wincentive Savings Account, your name is entered intro a drawing to win $100 a month, $500 a quarter, and $5,000 a year. You can deposit as much as you like, but you are only allowed four entries per month.
Garrett says members opened more than 40 Wincentive savings accounts since Jan. 1.
“We had four $100 winners out of our pool of just over 40 members who came and opened an account. So, one in 10 people who open an account will walk away with $100,” says Garrett. “There are no added fees, just them committing to saving their own dollars for their own potential purposes.”
With such good odds during month one, the expectations here are that more people will be signing up to save.
Minnesota isn’t the first state to try out a program to encourage people to save money. In Michigan, more than 11,000 people signed up for a similar program and by the end of the first year, every person saved $1,000.