A credit union is a type of financial institution that is owned and operated by its members. Unlike traditional banks, which are owned by shareholders and operate for profit, credit unions are not-for-profit organizations that exist to serve the financial needs of their members.
Credit unions offer many of the same financial services as banks, such as savings and checking accounts, loans, credit cards, and online banking. However, credit unions may offer some unique features and benefits to their members, such as lower fees and interest rates, higher dividends on savings accounts, and a focus on community development.
To become a member of a credit union, you must meet certain eligibility requirements, which can vary depending on the credit union. Common eligibility criteria include living or working in a particular community or being affiliated with a specific organization or employer. Once you become a member, you typically have a say in how the credit union is run and may be able to vote on important decisions.
Credit unions are regulated by the National Credit Union Administration (NCUA), which is a federal agency that oversees and insures credit unions. Like banks, credit unions must adhere to certain rules and regulations to ensure the safety and soundness of their operations.
Overall, credit unions can be a good choice for individuals or businesses that value a focus on community and cooperative ownership, and are looking for financial services that may offer lower fees and better rates than traditional banks.
This page was last updated on March 31, 2023.