Credit union launches digital bank supporting ‘local heroes’

Gesa Credit Union in Richland, Washington, publicly launched its first national digital banking platform this week designed to “support our nation’s heroes through everyday banking.”

The platform, called ValorFI Heroes, will donate a portion of every debit card transaction a member makes to vetted nonprofits serving community-focused occupations that the platform refers to as “heroes,” such as educators, first responders and veterans.

“Our heroes dedicate their lives to serving others and ValorFI Heroes creates a simple yet powerful way for all Americans to give back to those who give so much,” said Andrew Chung, chief information officer for ValorFI Heroes, in a statement. “When members choose ValorFI Heroes, they’re joining a movement that transforms routine purchases into meaningful support for organizations that serve and protect our heroes.”

ValorFI Heroes

“It’s really designed for anyone who wants to support one of those local heroes groups, whether they’re a member of that group today, like a firefighter or an educator, or they’re just passionate about supporting that organization,” Keven Gray, chief retail officer at Gesa Credit Union, told American Banker.

Members select their preferred “hero category” upon signing up for the digital banking platform – current options include educators, first responders, health care workers, law enforcement officers and veterans – and participate in regular voting to determine which of ValorFI’s partner charities in the chosen category receives their contributions.

“On a quarterly basis, members will be eligible to vote for which of the nonprofits receive the funds for that quarter and we will direct the majority of funds to the organizations that have the majority of the votes from our membership,” Gray said. “The design is that the donations would be proportionally distributed based on the votes of the members. We want to make sure that we are supporting our members by supporting the groups they’re most passionate about and they feel are having the biggest impact.”

The platform is an extension of Gesa Credit Union’s already existing Local Heroes grant program, which launched in 2021.

ValorFI Heroes

“Last year here in the Pacific Northwest through our Local Heroes group at Gesa Credit Union, we gave back almost $500,000 to local hero organizations,” Gray said. “We’ve seen how it’s impacted not only those organizations but the people in the communities, and we just want to expand that across a broader audience.”

The launch of ValorFI is the first time the $5.6 billion-asset credit union has expanded its banking services to a national scale. All its other services and charitable initiatives are provided specifically to the Pacific Northwest region.

“We have not done anything national to this point,” Gray said. “Our existing field of membership is in Washington, Idaho and Oregon. That’s where we’ve historically operated and our primary focus is still supporting the Pacific Northwest.”

However, the success of the credit union’s Local Heroes program inspired Gray, who is the executive sponsor of the ValorFI Heroes initiative, to expand the charitable giving model to a wider audience.

“We feel like this is a great way to take a very impactful program and the power of the community give-back model to a more national level,” he said. “Today we’re supporting national organizations, but we envision a time when we can localize it to more geographical areas and really focus on those organizations that impact specific communities throughout the country.”

Current charities partnering with ValorFI Heroes include Educators of America, U.S. Vets and Project HOPE, according to a press release.

Charitable giving through debit or credit card transactions is gaining traction in the payments space, with fintechs like Karma Connect offering API integrations focused on seamlessly directing cashback rewards to nonprofit charities.

Other banks have also integrated charity-focused initiatives into their services to meet socially conscious consumer demand. U.S. Bank created a permanent rewards-redemption option in September 2023 for customers of its Altitude Go Visa credit cards to redeem points for a monetary contribution to one of eight national nonprofit organizations, with U.S. Bank matching the dollar value of each contribution. American Express also launched a pilot run of a Round Up giving program in September 2022. That pilot was discontinued a year later.

Some financial institutions have charity-focused grant awarding based on community votes, such as Monson Savings Bank’s annual Community Giving Initiative. However, Monson’s initiative is a straight-sum $25,000 grant distributed by votes and not proportionally connected to member’s individual debit card transactions like ValorFI Heroes.

“The one thing that we feel is really unique about this program is that not only do the members get to participate in the give-back, but they get to decide where the give-back goes,” Gray said. “They’re driving the initiative. They’re driving where those funds go and where it impacts their communities.”

The community voting element of ValorFI’s philanthropy echoes how Target operates its Community Giving program through Target Circle. In the program, Target Circle members accumulate votes with each Target purchase and then distribute their votes to Target’s partner charity organizations. Those votes are then tallied by the retailer, who awards grants to the chosen charities based on the percentage of votes they receive. Target reported $26.9 million dollars in donations to partner nonprofits directed by community votes as of July 1, 2023.