About Credit Unions
What is a Credit Union?
A credit union is a member-owned, not-for-profit, cooperative financial institution.
- Provide the same products and services—including surcharge-free ATMs, online financial services, and free savings and checking accounts—as other financial institutions
- Return their profits to their credit union members by providing better services, better rates, lower fees and special discounts
- Operate under the philosophy of “people helping people,” allowing their members to pool their savings, lend to one another, and own the organization
- Follow conservative investment practices and lend responsibly
Federal credit unions are chartered and supervised by the National Credit Union Administration (NCUA). Through this federal agency, savings in federal and most state-chartered credit unions are insured by the National Credit Union Share Insurance Fund (NCUSIF), a federal fund backed by the United States government. The funds in some credit unions are privately insured.
Easy to Join a Credit Union
Anyone can join a credit union—because each credit union serves a "field of membership" which is made up of people who all share a “common bond.” You may be eligible to join one or more credit unions based on your:
- Geographic area
- Place of worship
- Membership in an organization
Just ask anyone at your local credit union what their requirements are. You might be surprised at how many credit unions you can join!
Members Own the Credit Union
A credit union is a democratic, member-owned cooperative. So when you join a credit union, you’re more than a member; you’re an owner—and that means you have a say in how your credit union is run.
A volunteer board of directors, elected by the members, governs a credit union. With their vote, each member has a direct impact on the direction of the credit union. As part of the democratic process, each credit union holds an annual election where members select candidates for the Board of Directors. This is very different from a bank, where stockholders vote according to the number of shares of stock they own.
Credit Unions are Non-Profit
Credit unions provide the same products and services as other financial institutions—but credit unions are non-profit and exist to help people, not to make a profit. As such, all earnings are returned to their members in the form of high-interest savings and low rate loans.
This also enables credit unions to operate at a lower cost than many for-profit institutions, and helps them to offer competitive loan and savings rates to their members.
Credit unions follow conservative investment practices and lend responsibly and live within their financial means, so you can trust your credit union's decisions.
Credit Unions Put People First
Credit unions live by the philosophy of "People Helping People.”
Credit unions across the country are committed to their communities, offering financial services to underserved populations, engaging youth in financial education, and returning profits to their members.
While they are not mandated to do good works, as banks are, by the Community Reinvestment Act, credit unions serve their communities to strengthen the connection with members and improve the quality of life for those in need of financial services. The National Credit Union Foundation coordinates the “Real Solutions” program, which supports community reinvestment programs in 33 states.