About Credit Unions | MyCreditUnion.gov (2024)

FAQs

What are 5 facts about credit unions? ›

A credit union is a not-for-profit financial institution that accepts deposits, make loans, and provides a wide array of other financial services and products.

Lower borrowing rates and higher deposit yields.

This enables credit unions to charge lower interest rates on loans, including mortgages, and pay higher yields on savings products, such as share certificates (the credit union equivalent of certificates of deposit).

Credit unions are not-for-profit organizations that exist to serve their members. Like banks, credit unions accept deposits, make loans and provide a wide array of other financial services. Credit unions are owned and controlled by the people, or members, who use their services.

The pros of credit unions include better interest rates than banks, while the cons include fewer branches and ATMs.

First, bankers believe it is unfair that credit unions are exempt from federal taxation while the taxes that banks pay represent a significant fraction of their earnings—33 percent last year. Second, bankers believe that credit unions have been allowed to expand far beyond their original purpose.

Alliant Credit Union is fully digital and has the best APY across all accounts compared to other credit unions on our list. With a $100 minimum balance, Alliant's high-yield savings account earns 3.10% APY. Its share certificates also earn excellent rates as high as 5.20% on a 12-month jumbo certificate.

Like banks, which are federally insured by the FDIC, credit unions are insured by the NCUA, making them just as safe as banks.

Unlike banks, credit unions take their profits and use it to help members with low interest loans and other financial services. Credit Union of Southern California has been in business for over 60 years, and we are the fastest growing credit union in Southern California.

Like we hinted at in the last reason, Credit Unions are known to have better and lower loan rates compared to big banks because our profits go right back to our members in the form of great deals. Expect lower interest rates and bigger returns with a Credit Union.

How to save money in credit union? ›

There are several ways you can save with a credit union – via local collection points, by direct debit or by having money deducted directly from your wages. Some credit unions offer a fixed rate of interest on savings, but most give you a yearly pay-out called a 'dividend'.

If you are opening a checking account at a credit union or traditional bank you will be offered a debit card when you open your account. Or you may request a debit card at any time. Most financial institutions let you apply for a debit card online.

2 – There are 10x as many female CEOs in credit unions than in banks. 3 – 82% of large credit unions offer free checking, while only 38% of banks do the same. 4 – Credit unions put an average of $16 billion per year into the pockets of everyday Americans. 5 – Without credit unions, 90,000 jobs would disappear.

Key Takeaways

Credit unions are member-owned, not-for-profit financial institutions that offer traditional banking services. Compared to banks, credit unions offer lower interest rates on loans and higher rates for checking and savings accounts.

They are non-profit organizations that are intended to provide high-quality services to its members, not to maximize profits. In addition, they are actively involved with the community. Credit unions are financial organizations that are structured in a cooperative model.

A labor union is an organization of workers dedicated to achieving a better employment situation, such as higher wages or safer working conditions. Unions are often funded through dues paid by members.

Higher returns, better savings, low interest on borrowings, and a sense of community – these are just a few of the benefits of credit union membership.

The first institutions that took on the storage of money and valuables, were the temples. For example, the inhabitants of ancient Athens kept their savings in the temples of the Acropolis and the medieval Europeans often save money in the monasteries. The word “Bank” is of Italian origin.