Credit Unions formed out of a need and desire to offer fair prices to the average consumer. In 1844, unfair business practices such as exorbitant interest rates caused a group of men to seek a solution. They formed a set of principles and values from which to operate their business. Time has not changed these values and principles much since that day long ago.
Structure/Philosophy - Not for profit, but for service.
Ownership - Member owned and controlled.
Control - Volunteer directors are unpaid and elected from and by the membership. Each member is required to maintain a balance of $5.00 in their Regular Savings Account and is granted one vote regardless of deposit balance.
Earning - All profits are returned to members in the form of new products, additional services, lower fees and expanded locations.
Products & Services - Credit unions and banks offer many of the same financial products and services. However, fees at credit unions are kept as low as possible, and rates are kept at their best for the membership.
Safety - Deposits are insured up to $250,000 by NCUA.
Structure/Philosophy - Banks are corporations, which exist to earn a profit for shareholders.
Ownership - Shareholder (investor) owned and controlled.
Control - Directors are paid and elected by shareholders. They are not required to use the products and services of the company or to live locally. Customers do not have voting rights unless they are stockholders. Shareholders are given voting rights in proportion to the number of stocks owned.
Earning - All profits are distributed to the stockholders in proportion to the number of shares owned.
Products & Services - Banks and credit unions offer many of the same financial products and services. Bank rates and fees are normally higher to insure the highest rate of return to the Investor.
Safety - Deposits are insured up to $250,000 by FDIC.