What is a Credit Union?

The Credit Union Difference

Owned & Controlled by the Members

Unlike any other financial cooperative, a credit union is owned and controlled by the members it serves. Every credit union is formed in the same way. A group of people want to involve themselves with their own financial destiny so they pool their money as savings and make low cost loans to one another.

They define themselves in terms of membership whether it be employment, religion, geographic area, some other criterion or combination – and make voluntary membership available to everyone within that definition. Credit Unions are regulated either by Federal or State law, depending upon the source from which that group receives its charter.

What is the difference between a Credit Union and a bank?

  • Credit Unions are non-profit financial organizations. After meeting normal expenses and the reserve requirements needed to ensure financial stability, a credit union returns all net earnings to their members in one form or another. Banks are for-profit institutions in existence to generate returns for their stockholders. The stockholders decide who sits on the board of directors.
  • The members own the Credit Union, electing directors from among the membership. This small group of members is charged with the responsibility of acting in the best interests of all members. Every credit union operates democratically.
  • Credit Unions are tax-exempt. The benefits of our tax-exempt status as a not-for-profit cooperative are returned to members in the form of higher rates on savings, lower fees and lower loan rates.

Credit Unions may look like banks in many ways, but their primary purpose hasn’t changed since 1850 – to serve members. This service means lower loan rates, higher savings rates and lower fees on other products. It is what makes credit unions different and sets them apart from other financial institutions.


Credit union’s exist to provide financial services for the purpose of improving lives. While our first responsibility is to our members, being a part of a cooperative movement means looking beyond our walls to the larger community in which we work and reside.

Credit Unions are committed to service and have been since their beginnings in 1850. The credit union concept is a simple one: people working together and pooling their savings can create a valuable credit source not otherwise available to them.

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