Why a Credit Union?
The Credit Union Difference
Banks and Credit Unions are the same in that they both operate under federal or state charters. Their deposits, up to $250,000, are insured by one of two federal agencies: the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA). Both are subject to periodic regulatory and federal insurance examination.
They are different in that Credit Unions, such as ours, are established to promote the financial well-being of their members, from those people of modest means to those of significant wealth, through a system that is cooperative, member-owned, volunteer directed and not-for-profit.
"Not for profit, not for charity, but for service."
Credit unions began as an idealistic, yet practical, experiment. The concept was simple: Members pool their savings and lend to each other. Today, thousands of credit unions – which are democratically controlled financial cooperatives – serve millions of members worldwide. Credit union membership confers a real financial benefit, to the tune of about $10.9 billion a year; that’s about $240 a year per U.S. member household, according to Credit Union National Association (CUNA).
Banks are for-profit institutions looking to make a profit for their shareholders; their boards of directors are compensated. Credit unions are not-for profit, their income is reinvested in its’ members thru dividends and services. Boards are volunteer and elected from among the members. With that philosophy, credit unions can offer higher interest rates on deposits and lower rates on loans.
From the beginning, credit unions have sought to keep people economically independent – by helping them learn to save and borrow prudently.
"Credit unions work for the membership’s best interest, not for the interest of a few stockholders."