AI-powered outsourced credit card programs help credit unions grow, cut risk, and stay member-centric while strengthening fraud protection and community impact.
Credit card portfolios are quietly driving a huge share of non-interest income for credit unions, yet many mid-sized CUs are seeing flat or declining card growth. At the same time, fraud is getting smarter, member expectations are higher, and tech budgets aren’t keeping up.
Here’s the thing about credit card strategy in 2025: if your team is trying to build everything in-house, you’re probably overpaying for mediocre results. The smarter move for many credit unions is an AI-enabled outsourced credit card program that keeps the member relationship local while offloading risk, compliance, and heavy technology lift.
That’s the model Toby Mattson, Director of Community Partnerships at Elan Credit Card, talked through on The CUInsight Network. And it fits perfectly into a broader shift we’re seeing in this AI for credit unions: member-centric banking series: use AI where it’s strongest (data, prediction, automation), and keep your people focused on empathy, advice, and community.
This post breaks down how outsourced credit cards + AI can actually strengthen your culture, protect members, and deepen relationships—rather than “giving away” your card portfolio.
Why outsourced credit cards make sense for member-centric CUs
Outsourcing a credit card program, when it’s done right, frees your team to be more member-centric, not less.
Most credit unions underestimate the full burden of running a competitive card program in-house:
- Constant product refreshes and rewards optimization
- 24/7 fraud monitoring and dispute handling
- Regulatory changes, compliance testing, audits
- AI fraud tools, machine-learning models, and data infrastructure
- Mobile app and digital wallet integrations members now expect
That’s a lot for a lean CU team that’s also trying to grow checking, mortgages, auto, and deposits.
An outsourced partner like Elan takes on the heavy operational and technology work while the credit union still brings:
- The member relationship
- Brand, marketing, and community presence
- Local financial counseling and recovery strategies
“It’s more than credit cards here, it’s about the members and communities.” – Toby Mattson
If you’re evaluating outsourced credit cards in 2025, the key is alignment: you want a partner whose AI tools, fraud systems, and analytics are built to support your member experience, not replace it.
How AI is reshaping credit card portfolios for credit unions
AI in credit card programs isn’t just about fraud rules anymore. The best programs are using AI across the member lifecycle: acquisition, underwriting, engagement, and retention.
1. Smarter underwriting without losing your “people helping people” ethos
AI-driven decisioning lets outsourced credit card partners evaluate thousands of data points in milliseconds. Done well, this can actually expand access to credit while managing risk.
For example, AI can:
- Use alternative data (payment histories, cash-flow patterns) when traditional credit files are thin
- Differentiate between a member in temporary hardship and one showing long-term distress
- Tailor credit limits and APRs based on real risk instead of blunt policy tiers
For credit unions focused on financial inclusion, this is huge. You can:
- Approve more members safely
- Offer gentler step-up products for emerging borrowers
- Use human review where the AI is uncertain or where member history matters
The reality? AI doesn’t replace your loan officers. It gives them better visibility so they can say “yes” more confidently—and step in with judgment when the model is on the fence.
2. Always-on AI fraud detection that members actually feel
Fraud losses on cards are rising globally, and fraudsters are already using AI. Fighting that with static rules is a losing battle.
An AI-native outsourced credit card platform can:
- Analyze millions of transactions in real time
- Spot micro-patterns across institutions (not just your CU)
- Adjust fraud thresholds dynamically instead of waiting for manual rule changes
Members feel this in practical ways:
- Fewer false declines at the grocery store
- Faster alerts on suspicious charges
- Quicker resolution when something does go wrong
When members see that “your credit union caught this for me,” trust jumps. And that trust carries over into every other product conversation.
3. Personalized rewards and offers that support financial wellness
Traditional card programs blast the same rewards to everyone. AI-powered outsourced programs can segment far more precisely.
For example, an AI system can:
- See that a member is paying interest month after month and surface a lower-rate offer or balance plan
- Notice increased grocery and gas spend and automatically spotlight relevant rewards categories
- Identify when a member is likely to churn and proactively send a targeted retention offer
This aligns with a member-centric banking approach: use AI to anticipate needs, then train your people to have better conversations. A frontline team equipped with these insights looks less like sales and more like proactive guidance.
Consumer trends: what members expect from credit card programs now
Toby Mattson highlighted a critical shift: credit cards are no longer just a payment tool; they’re a financial wellness lever in members’ lives.
Here’s what consumers are expecting in late 2025:
- Instant digital access – Digital issuance, digital wallets, self-service controls
- Transparent, fair pricing – Clear rates, fees, and options for those carrying balances
- Integrated security – Biometrics, transaction alerts, and card controls in the same app they trust
- Values alignment – Cards that support local communities, green initiatives, or charitable causes
An outsourced AI-enabled card platform can adapt faster to these expectations than most in-house setups can. The trick for credit unions is to own the narrative with members.
Turning a “vendor program” into a member story
When you roll out or refresh an outsourced credit card program, connect the dots for members:
- “We’ve partnered with a specialist so you get stronger fraud protection and more flexible rewards.”
- “Our new program lets us focus more of our staff time on financial counseling and local lending.”
- “Every transaction helps us invest more back into this community.”
Members don’t care if the rewards engine is hosted in your data center or your partner’s cloud. They care about outcomes: safety, clarity, meaningful benefits, and community impact.
Charitable giving and community impact: where Elan’s model stands out
One of the most interesting parts of Toby’s conversation was Elan’s Charitable Giving program, which supports community organizations alongside credit union partners.
Programs like this are a natural fit for credit unions because:
- They create a tangible link between everyday card usage and local impact
- They give marketing teams real stories, not just rate sheets, to share
- They reinforce the idea that technology upgrades are in service of mission, not the other way around
Here’s how a CU can weave AI and community impact together in a card program:
-
Data-informed cause selection
Use member demographic and transaction data (ethically, in aggregate) to understand what causes resonate locally—schools, food insecurity, housing, small business growth. -
Transparent program design
Clearly communicate: “X cents per transaction” or “Y% of portfolio revenue goes to…” and report back quarterly. -
Storytelling with specifics
Instead of “we support local causes,” say, “This card helped fund 200 backpacks for students this fall.” Those specifics come from good data and good reporting.
When an outsourced card partner already has the charitable infrastructure and reporting in place, your team isn’t trying to reinvent the wheel. You’re focusing on selecting causes, engaging members, and telling the story.
Protecting culture while you outsource: practical playbook for CU leaders
Most leaders I talk to aren’t afraid of outsourcing the technology. They’re afraid of outsourcing the soul of the credit union.
The good news: you don’t have to.
Here’s a simple playbook to keep your culture and engagement strong while outsourcing your credit card program.
1. Define your non-negotiables up front
Before you issue an RFP or sign a contract, write down:
- What member experience must feel like (tone, response times, escalation paths)
- How you define success beyond revenue (NPS, complaint ratios, community impact)
- Which decisions must stay in-house (hardship exceptions, charge-off practices, marketing voice)
Use these as filters for partner selection and as language in your SLA.
2. Treat the partner like an extension of your team, not a black box
Once your program is live, keep your culture front and center:
- Include partner reps in key member experience or AI strategy meetings
- Share your brand guidelines and financial wellness philosophy
- Set a cadence for reviewing AI outputs: underwriting decisions, declines, fraud flags, complaints
You want your partner’s AI systems and servicing teams to “speak credit union,” not just “speak portfolio.”
3. Train your people on AI-enhanced conversations
AI for credit unions only works when your people know how to use the insights.
Equip frontline staff and lenders with:
- Clear explanations of how your outsourced card program benefits members
- Talking points for common “why did I get declined?” or “why did this get flagged?” questions
- Dashboards or reports (from your partner) that surface opportunities: pre-qualified members, likely revolvers, at-risk members
The goal is simple: AI handles pattern recognition; your people handle human recognition.
Where to start: a practical roadmap for CUs considering outsourced AI card programs
If you’re rethinking your credit card strategy for 2026 planning, here’s a phased approach that actually works.
Phase 1: Assess your current portfolio honestly
Ask your team:
- How much net income is the card portfolio producing per member?
- What’s our fraud loss rate compared to peers?
- When did we last significantly refresh rewards, pricing, or digital experience?
- How many FTEs are effectively “tied up” running cards?
This will show you whether an outsourced AI-enabled program can realistically move the needle.
Phase 2: Define your AI and member-centric goals
Be precise:
- “Reduce fraud losses by 30% while cutting false positives.”
- “Approve 10–15% more members without raising charge-off rates.”
- “Use AI insights to drive more proactive financial wellness outreach.”
These targets help you evaluate partners like Elan on something more meaningful than just rebates or revenue share.
Phase 3: Choose a partner that aligns with your mission
Look for:
- Proven AI fraud and decisioning tools specifically tuned for credit unions
- A clear model for how they protect and enhance member experience
- Community and charitable programs that reflect your values
- Transparent reporting, data sharing, and co-branded member communication
Phase 4: Launch as a member-centric initiative, not just a product swap
When you launch or convert, frame it as:
- “Stronger security, smarter approvals, and more support for our community.”
- “We’re upgrading your experience and keeping our focus on you.”
Your messaging, your staff training, and your community storytelling should all tie back to the core theme of this series: AI for credit unions is about member-centric banking, not tech for tech’s sake.
AI-enabled outsourced credit cards are one of the clearest ways credit unions can punch above their weight: you gain enterprise-level fraud tools, smarter decisioning, and modern digital experiences without losing your local focus.
As Toby Mattson put it, the point isn’t just running cards more efficiently. It’s using technology and partnerships so you can put more energy into members and communities.
If your card portfolio feels stuck, or your team is buried in manual work, this is the moment to rethink your approach. The credit unions that win the next decade won’t be the ones doing everything themselves—they’ll be the ones using AI and partners thoughtfully to deepen trust and impact.