Texans CU - Open an Account - Credit Unions vs. Banks

Credit Unions vs. Banks

Credit unions (or CU's) are consistently shown to have more satisfied members than banks. If you're not sure what the difference is between the two, we've pointed out some key characteristics that show why credit unions continue to outpace banks in member satisfaction.

CREDIT UNIONS	BANKS
Not-for-profit financial cooperatives	For-profit corporations
Accountholders are members	Accountholders are customers
Tax exempt because they are not-for-profit cooperatives owned by taxpaying depositors	Pay taxes on profits they distribute to outside stockholders
Loan rates are capped at 18%	Lending rates are unregulated
Organized to serve a specified field of membership	Open to the public
Owned by their members, democratically controlled: one member = one vote	Owned and controlled by outside stockholders
Focus is on consumer loans and member savings	Focus is on commercial loans and accounts
Dividends are paid to the member	Dividends are paid to the stockholders
Voluntary directors and committees - voluntary reflects diversity of membership	Paid directors - board members do not necessarily reflect the diversity of their customer base
Known for offering more favorable rates and services	Known for higher fees and less favorable rates
Cooperation between credit unions	Competition between banks
Insured to $250,000 by NCUA/NCUSIF	Insured to $250,000 by FDIC/BIF
Insurance fund is self-insured - has never caused a loss to the taxpayer	S&L bailout used BIF taxpayer dollars
Motivated to maximize service	Motivated to maximize profits