Credit Unions

I have been a satisfied member of a credit union I belonged to for years until recently. I read somewhere that nearly 70% of credit union customers feel that their credit union has their best interests in mind. Credit unions are not-for-profit organizations that work to pass on earnings to account holders in the form of better rates on savings accounts and loan products. The remaining 30% do not feel the same way. I wonder why?

I can see why a member may be treated differently due to various circumstances.

Most Credit Unions' guiding principles have remained the same:

(1) Only people who are credit union members should borrow there;

(2) Loans are made for "prudent and productive" purposes;

(3) A person's desire to repay (character) is considered more important than the ability (income) to repay.

Members are, after all, borrowing their own money. These principles still govern most of the world's credit unions. Credit unions (most of the time) continue to look out for their members’ interests and provide a level of service that is not generally available at other financial institutions. Whether it’s providing a loan to help a member cover unexpected medical bills, giving financial counseling to a member whose company closed its doors, or simply offering a better deal on a used car loan, credit unions make a difference for their members and the communities they serve.

Credit unions do provide many services that banks offer. But the core values are so different—regardless of the credit union’s size or offerings. As a credit union member, you’re not just a customer; you’re an owner, with a vote in determining the direction of the credit union. And because credit unions are not-for-profit, all earnings go back to the members in the form of great rates and low fees. It’s about putting people before money. Banks, on the other hand, exist to make a profit for shareholders. While that is fine, it means they’re not motivated by the same values as credit unions. Regardless, both Banks and Credit Unions rely on the faith and confidence of their customers/members in order to stay in business.

My personal opinion is that Credit Unions are still better than banks and other financial institutions. In my personal case, I will continue to evaluate my relationship with my Credit Union.