Prize-Linked Savings
State Issues Brief
Background
Prize-linked savings programs motivate people to save money by offering them prizes that are linked to
their savings accounts. The concept of prize-linked savings was pioneered by Harvard Business School
professor Peter Tufano and his non-profit, Doorways to Dreams Fund (D2D). Currently, 21 states
expressly allow such programs: Michigan, Rhode Island, Maine, Washington, North Carolina,
Nebraska, Maryland, Connecticut, Indiana, New York, Virginia, Arkansas, Minnesota, Oregon, Illinois,
New Jersey, Kansas, Missouri, South Carolina, Arizona, and Louisiana.
In 2009, D2D collaborated with the Michigan Credit Union League and others to launch a successful
prize-linked savings program. Despite Michigan’s economy, 11,666 members at eight Michigan credit
unions saved $8.56 million in the first year of the program. Michigan credit unions were uniquely
situated to participate in the program because of a provision in the Michigan Credit Union Act that
allows savings raffles. Members participating in Michigan’s “Save to Win” program have saved tens of
millions of dollars. Most of the savings have come from first-time members and under-banked
members.
Prize-linked Legislation in the States
2016
New Jersey –S 2495. Permits credit unions, banks, and savings banks to conduct promotions in which a
minimum deposit in an amount predetermined by the institution qualifies for a chance to win prizes.
Louisiana – H 681. Permits credit unions to implement prize-linked savings in Louisiana and encourage
credit union members across the state to save.
Missouri – H 2125. Permits credit unions, banks, and savings banks to conduct promotions in which a
minimum deposit in an amount predetermined by the institution qualifies for a chance to win prizes.
Kansas – S 390. Permits credit unions, banks, and savings banks to conduct promotions in which a
minimum deposit in an amount predetermined by the institution qualifies for a chance to win prizes.
South Carolina – S 652. Permits credit unions, banks, and savings banks to conduct promotions in which
a minimum deposit in an amount predetermined by the institution qualifies for a chance to win prizes.
Arizona – H 2471. Permits credit unions to implement prize-linked savings programs.
2015
Virginia– S 737. Permits savings promotion raffles.
https://leg1.state.va.us/cgi-bin/legp504.exe?151+ful+CHAP0012
CUNA’s State Government Affairs – August 2016
Arkansas – H 1642. Permits banks and credit unions to conduct savings promotion raffles.
http://www.arkleg.state.ar.us/assembly/2015/2015R/Acts/Act589.pdf
Minnesota – H1127. Permits savings promotion raffles.
https://www.revisor.mn.gov/laws/?year=2015&type=0&doctype=Chapter&id=29
Oregon – H2726. Permits financial institutions to conduct a savings promotion raffle, subject to
specified conditions. Exempts savings promotion raffles from the definition of “gambling.”
https://olis.leg.state.or.us/liz/2015R1/Downloads/MeasureDocument/HB2893/Enrolled
CUNA’s State Government Affairs – August 2016
Illinois – H 2477. Amends the Illinois Banking Act to allow savings promotion raffles.
http://www.ilga.gov/legislation/publicacts/fulltext.asp?Name=099-0149
2014
Indiana – H 235. Amended banking laws to allow credit unions to offer savings promotion raffles.
http://iga.in.gov/legislative/laws/2014/ic/titles/028/articles/001/chapters/23.2/
New York – A 9037. Authorizes credit unions and other financial institutions to conduct savings
promotion prize giveaways.
http://assembly.state.ny.us/leg/?default_fld=&bn=S06805&term=2013&Summary=Y&Text=Y
2013
Connecticut – H - 5564. Amended banking laws to allow credit unions and community banks to offer
savings promotion raffles.
http://www.cga.ct.gov/2014/ACT/pa/pdf/2014PA-00007-R00SB-00283-PA.pdf
2012
Maryland - H 786. Amended commercial and lottery law to allow credit unions and depository
institutions to offer savings promotions raffles (in partnership with Maryland CASH Campaign).
http://mgaleg.maryland.gov/2012RS/chapters_noln/Ch_393_hb0786t.pdf
2011
Nebraska - LB 524. Amended gambling law to allow credit unions to offer savings promotion raffles (in
partnership with Financial Hope Collaborative and the Nebraska Credit Union League).
http://www.ncsl.org/documents/labor/workingfamilies/NEL524_2011.pdf
North Carolina - S 513. Amended credit union laws to allow savings promotion raffles (in partnership
with the North Carolina Credit Union League).
http://www.ncleg.net/EnactedLegislation/Statutes/HTML/BySection/Chapter_54/GS_54-109.64.html
Washington - S 5232. Amended gambling and banking law to allow financial institutions to offer chance
based products (in partnership with the Washington Asset Building Coalition and the Northwest Credit
Union Association).
http://lawfilesext.leg.wa.gov/biennium/2011-12/Pdf/Bills/Senate%20Passed%20Legislature/5232S.PL.pdf
2010
Maine - SP 0645. Amended gambling and banking law to allow credit unions to offer savings promotions
raffles.
http://legislature.maine.gov/statutes/9-B/title9-Bsec825.html
Rhode Island - S 2399. Amended credit union and lottery laws to allow credit unions to offer savings
promotion raffles (in partnership with Credit Union Association of Rhode Island).
http://webserver.rilin.state.ri.us/Statutes/TITLE19/19-5/19-5-29.HTM
CUNA’s State Government Affairs – August 2016
2009
Michigan - No legislation was required because the Michigan Credit Union Act allowed credit unions to
offer savings raffles.
http://www.legislature.mi.gov/(S(lhojg1jnbriljyezhc3yt245))/mileg.aspx?page=getObject&objectName=
mcl-490-411
The American Savings Promotion Act
In December 2014, President Obama signed the American Savings Promotion Act (the ASP Act) which
removed barriers that previously prohibited banks and thrifts from offering PLS programs. That means
more financial institutions will be able to offer these programs. While the ASP Act amended federal
banking laws to allow prize-linked savings, it did not amend the Federal Credit Union Act and nor did it
need to – since the Federal Credit Union Act does not prohibit (nor explicitly permit) federally-chartered
credit unions from offering prize-linked savings programs. States will still have to pursue legislation to
allow these programs for credit unions.
Prize-Linked Savings Resources
D2D prize-linked savings resources - http://www.d2dfund.org/
PBS video on prized-linked savings - http://video.pbs.org/video/2365128153/
CUNA’s State Government Affairs – August 2016