The Backstory Behind Easy Pay,
As Told in ‘Organized Money’

In Chapter 5 of Mark Pinsky and Keith Mestrich’s new book “Organized Money: How Progressives Can Leverage the Financial System to Work For Them, Not Against Them,” authors Mark Pinsky and Keith Mestrich write about the impetus behind Weavers Way’s development of Easy Pay and its benefits to the Co-op and to members.

“Weavers Way Co-op, a small grocery chain in Northwest Philadelphia, paid $425,000 on credit card fees in 2018, according to Norman Weiss, the store’s purchasing manager. Writing in the Shuttle, the Co-op’s house publication, he asks if ‘there is a better method of offering shoppers a convenient payment method that doesn’t send $425,000 out of the co-op economy to be spent by banks and credit card processors on who knows what.’

“In the same newsletter, Weavers Way general manager Jon Roesser extols the cooperative ideal. ‘Sustainable civilizations yield common prosperity,’ he writes. ‘As member-owners of Weavers Way, we are setting the example through our support of a cooperative enterprise that is forever working toward mutual prosperity.’

“Weavers Way’s credit card fees are part of the billions of dollars credit card financial institutions and independent processing companies earn annually on transaction fees (apart from annual card membership fees). Little, if any, of Weavers Way’s $425,000 ends up supporting the cooperative movement.

“…The power of the cooperative model to blend profit and purpose, and the values of cooperatives that put member interests before outside investor priorities is diminished as a result. That is one factor that led Weavers Way to give a big chunk of business to a friendly and supportive big bank instead of a local credit union when it was expanding its business to a new location recently. The bank offered financing on good terms and worked hard to help the Co-op. In addition to the money it will earn from the loan it made to Weavers Way, the bank is happy to attach its reputation to a much-loved community business.

“To reduce its credit card transaction fees, Weavers Way came up with an innovative solution that organized money in a different but beneficial way. It offered its members a two percent incentive to prepay for purchases through a program it calls Easy Pay: deposit $100 in Easy Pay and receive $102 of value. It is cheaper and preferable to pay members two percent for use of their money than it is to pay credit card companies more than two percent for theirs.

“In addition, the prepayments put a small amount of working capital into the business that might even earn a modest return for Weavers Way. And Co-op members who can afford to prepay benefit financially, at least in the 2019 interest rate environment, because they are effectively earning a higher rate on their money than they can in savings or checking accounts anywhere. Members who deposited and spent $100 each month in 2018 earned two percent per month on their money compared to less than two percent per year in a savings account, or approximately 12 times as much.”