What's A Credit Union

Can’t tell the difference between credit unions and banks? Allow us to explain ... You might be saying to yourself, hey, they sure look the same from the outside ... They both lend money and let you save money too right?

Okay, okay, there are some similarities, but – there are some major differences too!

For starters, let’s take a look at the owners…

The Owners

Who owns the place? If it’s a bank, the institution is owned by investors and the bank works to make those investors money. If you bank at a credit union, we’re owned by our members, also known as a financial cooperative. Therefore, if you’re a member, the institution is essentially owned in part by you.

Where Do the Profits Go?

Another big difference between banks and credit unions is where the profits go. When you’re doing business with a bank, the investors of the bank are reaping all the profits! However, when you’re doing business with a credit union, the profits the credit union makes are returned to the members in the form of lower loan interest rates and higher dividends. Pretty cool, huh? The more business you do with the credit union, the more you benefit!

But My Money Is Safer at a Bank!

Huh? That may be the biggest myth of all! Sure, we’ve heard it before, people nervous about putting their money in a credit union because they’re not insured like a bank is by the FDIC. You’re right; we’re not insured by the Federal Deposit Insurance Corporation. However, credit unions are insured by their own federal agency. The National Credit Union Administration, also known as the NCUA. Both the FDIC and NCUA require that all institutions, banks and credit unions be subject to periodic regulatory and federal insurance examinations. And both federal government agencies insure your savings up to $250,000 by the United States Government.

Personalized Service

Okay, so maybe you love the service you get from your bank… but then again … maybe you don’t? We’ve often heard that folks love credit unions because they provide more personalized service than one of those larger chain banks where you’re just known by your account number. Why? Well, most credit unions are smaller and tend to offer business to a select group of people, like Sears employees and other employers who recognize that a credit union is one of the best fringe benefits you can offer to your employees. Other credit unions offer service to a select community, like the city of Bartlett. No matter which one you belong to, there tends to be more personalized service. You walk in and people know you by name, not just your number. If you don’t receive that service now, maybe it’s time to break up with your bank, you could always use the old standard … it’s not you, it’s me.