I was honored to speak at this summer’s meeting of the Responsible Credit Roundtable, organized by the Center for Financial Services Innovation. The Center brings credit card industry execs and non-profit leaders together to come up with ways that the public can be better served … without hurting the creditors’ bottom line … of course! Members include major players, such as: Experian, FairIsaac, Wells Fargo, Visa, USBank, National Foundation for Credit Counseling, Federal Reserve of Minneapolis, Take Charge America, and Target.

I spoke about the benefit to lenders in lowering and/or ditching nuisance fees as a revenue source and instead, offering responsible cardholders better incentives. We all have a pocketful of plastic, so the card issuers who dangle the juiciest carrots are the ones that’ll get our business. The cardholder wins by getting cash back, for example, and the lender wins by increasing business.

One of the most interesting win-win situations that I learned about through the Roundtable was a study conducted by Wells Fargo, which sent out a mailing to almost 78,000 randomly selected new college cardholders, offering a 60-minute phone card in exchange for completing an online credit education program. The good news is that the students who completed the program had much better payment records than the control group --  despite using their credit cards more. Moreover, they were less likely to carry a balance. Those who did, had lower balances and paid off more of them. In short, they used their cards more responsibly than the control group, so teaching people about credit early on seems to benefit both the students and the bank.

Despite the fact that only 6.65% of the experimental group completed the online education (this is a very good response rate for a study like this believe it or not), Wells Fargo sees the possibilities in this win-win situation and is now offering online education to all new student accounts. I think that’s great!

These days, the incentive is free song downloads, which I hope will appeal more to college kids than the phone cards. I think they will – which did you prefer way back when -- phoning home or listening to your fav music?!

The Center for Financial Services Innovation is a pretty interesting place, by the way. It develops and distributes research aimed at finding win-win situations for “underbanked” consumers and lenders. The Center is an affiliate of the innovative  ShoreBank, which is the country’s first community development and environmental bank. Both of these sites are well worth perusing. Please  let us know what win-win situations they bring to mind for you!

Curtis Arnold - Curtis is the CEO/Founder of CardRatings.com, a website that provides credit card ratings and reviews of over 20,000 offers.