Frequently Asked Questions

What is the difference between a bank & a credit union?
A credit union is a cooperative, not-for-profit financial institution organized to promote thrift and provide credit to members. It is member-owned and controlled through a board of directors elected by the membership. One member, one vote.

The board serves on a volunteer basis and may hire a management team to run the credit union. The board also establishes and revises policy, sets dividend and loan rates, and directs certain operations.

The result: members are provided with a safe, convenient place to save and borrow at reasonable rates at an institution which exists to benefit them, not to make a profit.

In contrast, banks are for-profit financial institutions that are governed by a paid board of directors that generally are the largest depositors and those that own the majority of stock.

Who owns a credit union?
Most financial institutions are owned by stockholders, who own a part of the institution and intend on making money from their investment. A credit union doesn’t operate in that manner. Rather, each credit union member owns one “share” of the organization. Members vote on important issues, such as the election of member representatives to serve on the board of directors.
How did credit unions start?
The first credit union cooperatives started in Germany over a 120 years ago. Today, credit unions are found in over 80 countries. The credit union movement began in 1909 in Manchester, New Hampshire as St. Mary’s Cooperative Credit Association, a church-affiliated credit union. Today, there are over 100 million credit union members in the United States.
What is the purpose of a credit union?
The primary purpose of credit unions is provide a not-for-profit financial alternative to help provide access to low-cost or no-cost financial services. Generally, credit unions offer lower loan rates and higher savings yields while helping people to improve their lives by eliminating the need to use fringe providers such as title loan companies, buy-here, pay-here stores and others that charge extremely high interest rates and fees.

Rather than paying profits to stockholders, credit unions return earnings to members in the form of dividends, low-cost loans and improved services.

Are savings deposits insured?
Savings accounts are insured for up to $250,000 with additional coverage for retirement savings, by the National Credit Union Share Insurance Fund administered by the National Credit Union Administration (NCUA), an agency of the federal government.
Who can join a credit union?
A credit union exists to serve a specific group of people, such as a group of employees or the members of a professional or religious group. This is called a “field of membership.” The field of membership may include where they live, where they work, or their membership in a social or economic group.
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This credit union is federally insured by the National Credit Union Administration.

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