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Arkansas Act 589 Allows CUs to Create Savings Incentive Programs that Offer Prizes
Wednesday, June 3, 2015 7:00 AM

Credit unions in Arkansas may now offer savings promotion raffles, also known as Prize-Linked Savings Accounts, thanks to the recent passage of HB1642. This bill was signed into law as Act 589, the Arkansas Savings Promotion Act, and makes it lawful for a financial institution to conduct a raffle for individuals who participate in a savings program. 

Savings promotion raffles are drawings where the sole consideration required for a chance of winning the designated prize is the deposit of at least a specified amount of money into a savings account or other savings program. Act 589 enables credit unions to design savings promotions to encourage members to save money.

Specifically under the Act:

  • All financial institutions are eligible for the savings promotion raffle, including credit unions.
  • Financial institutions can conduct the savings promotion raffle for depositors who make the required deposit into a savings vehicle.
  • The raffle must be conducted so that each deposit provides the depositor with an equal chance of winning the designated prize.

“ACT 589 of 2015 adds a new dimension to the bingo and raffle law that was enacted in the State of Arkansas several years ago, legalizing raffles and bingo for nonprofit organizations," said Arkansas Credit Union Association President Reta Kahley. "This Act now allows credit unions and other financial institutions the opportunity to create for their depositors savings incentive programs that offer prizes and other promotional items for specified savings programs.”

For questions about this bill, please contact Reta Kahley at rkahley@arcua.coop.