What is a Credit Union?

A credit union is a non-profit, cooperative financial institution owned and operated by its members. Organized to serve and democratically controlled, credit unions provide their members with a safe place to save and borrow at reasonable rates. Credit unions differ from banks and other for-profit financial institutions in that members of a credit union are also owners. The board of directors are elected in a democratic one person-one vote system regardless of the amount of money invested in the credit union. Not for profit, not for charity, but for service is a credit union motto. Since profit is not a motivation, interest rates have been historically favorable for consumers at credit unions compared to banks.

Credit unions are not new. Originating in Europe, credit union history began in the United States when the first credit union was formed in Manchester, New Hampshire, in 1909. Today, over 9,000 credit unions with over $500 billion in assets serve more than 83 million people in the United States. More and more people join credit unions every year and they are pleased with the service. Credit unions have rated No. 1 in customer satisfaction at financial institutions for more than 10 years according to the American Banker Newspaper’s annual customer satisfaction survey.Credit Union Membership: To join a credit union, you must be eligible for membership. Each institution decides who it will serve. Most credit unions are organized to serve people in a particular community, group or groups of employees, or members of an organization or association. If you are a relative of a credit union member, you are also eligible to join.