Lovejoy recounted that the association had been with Barclays for card issuing for seven years and that the association used a competitive bidding process when it picked Barclays. But he couldn't explain what Barclays offered that won the credit union over since those negotiations had predated his time at the association.

Tom Montilli, vice president of marketing for HUECU, said the credit union began as solely serving the employees of the university but expanded its field of membership to include students and alumni about a decade ago.

He attributed HUECU wining the portfolio, in part, to it being a credit union at time when local community-based financial institutions and credit unions were rising in popularity.

He acknowledged that the new card had a number of features cardholders generally liked. These include no annual fee, no foreign transaction fees and no balance transfer fees. Unrestricted travel benefits allow cardholders to select any flight, hotel, cruise or car rental without blackout dates along with access to concierge services, rental car collision damage waiver, emergency card replacement and delivery services, ID theft resolution and a host of features for cardholders who travel extensively.

"Everyone involved with this project should be very proud of the work we've done. Our new partnership with the HAA has been a model of collaboration, with all parties working together flawlessly to achieve a common goal–to design a credit card program that combines unparalleled benefits and rewards, exceptional security and fraud protection, and sound financial principles," said HEUCU CEO Gene Foley. He also praised the payment CUSO PSCU for its role helping the credit union plan the conversion from the old card portfolio to the new.

"PSCU has also played a leadership role in planning the conversion in which the alumni cardholders will become part of our credit union, affording us the opportunity to offer them additional products and services," he said.

"The current economic environment has put a spotlight on the credit union industry's outstanding financial stewardship, including educational programs that equip members to make wise financial decisions and member-friendly practices," said PSCU CEO Michael Kelly. "Prestigious universities, alumni associations and other affinity groups are increasingly aligning with credit unions to deliver financial products to members of their organizations." 

The HUECU affinity deal was unusual in an additional respect as well. Not only was it an occasion for a credit union to win an affinity partner away from a bank, it also included the rare provision for the affinity partner, the HAA, to continue to control the existing portfolio.

When an organization moves from one affinity card issuing partner to another, what generally has happened has been that the new issuer starts to issue cards and market them only to members of the organization that do not already have a card. Members of the organization who already have a card with the former affinity issuer will generally have their cards rebranded and reissued without any identification with the organization, becoming just another one of the bank's customers.

But the HAA, when it negotiated its contract with Barclays Bank as an affinity issuer, retained control over the portfolio so HEUCU was able to purchase the existing affinity card portfolio as part of the deal.

"When you're putting the Harvard name on something, you tend to be careful about how you do it," explained Lovejoy. The association wanted to be able to offer its members an affinity card without losing control over what financial institution issued the card, he explained. 

HUECU will begin converting the cards to its card platform later this year and Montilli said the credit union made some changes to its procedures because of the portfolio. For example, the credit union will fund the opening of share accounts for each of the roughly 4,500 new members that will be arriving as cardholders. "We will fund the initial share deposit of everyone who comes in because of the alumni card," Montilli explained.