If you aren’t aware of the core differences between a bank and a federal credit union, there’s good news ahead — you’re not alone. Discover what sets the two institutions apart, and how consumers continue to prefer the latter.
Similar to banks, credit unions accept deposits, make loans, and provide many types of financial services. However, credit unions are owned by their members, while banks are owned by investors. When you deposit money to a credit union, you’re securing a membership, and therefore the credit union makes decisions to benefit you. A bank is a for-profit institution, run by a board of paid directors. Sometimes, decisions are made to profit a small group of outside investors, often at the expense of the customers.
A bank is free to conduct business with any client, while a credit union is required by law to limit their customer base to a “field of membership.” The requirements are easy to meet. You may be eligible to join a credit union because of where you work, the area you live, a family member’s eligibility, or through an affiliated organization. The emphasis on community-driven practices gives credit unions the ability to offer better service to their members.
Products & Services
Banks and credit unions offer many of the same products and services. Almost any bank or credit union provides the following products: business bank accounts, checking accounts, saving accounts, home loans, auto loans, and certificates of deposit. Banks and credit unions also offer online banking services in which you can view your accounts, make deposits, and more.
While most banks provide an abundance of locations, convenient ATMs, and 24/7 online
accommodations, they lack the one-on-one services that credit unions can deliver. Members of a credit union typically know the staff by name and take the time to build lasting relationships focused on trust and understanding, The conservative and member-focused policies of a credit union provide a safe space for people and their money, and the staff takes pride in providing consistent and meaningful service to its members.
What Should I Choose?
Most Americans conduct their financial transactions at a bank, but millions of people are finding that credit unions serve their needs better. If you’re looking to open a checking account with a community-driven institution that has your best interest in mind, it’s time to learn more about Your Credit Union.