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What is a Credit Union? | History | Board & Management | Branch & ATM Locations | Hours & Holidays | Disclosures | FAQs | News | Specials | Community Commitment | Scholarships and Awards | Contact Us Form
A credit union is a not-for-profit financial institution dedicated to serving the needs of its members through affordable products and services. All credit unions are governed by a Board of Directors, elected by and from its membership. Most credit unions are federally chartered and regulated by the National Credit Union Administration (NCUA). The NCUA annually audits and rates each credit union's operations and insures member accounts up to $500,000.
Credit unions are made up of people with a common bond - something that draws them together - a place of employment, an organization, a church, etc. When someone joins a credit union, they open a share account (savings). It is called a share account because the individual becomes part owner of the credit union.
Since credit unions are not-for-profit organizations, any money made above the cost of operations is returned to the members. This can be through dividends to members, offering of additional services, or low interest rates on money borrowed.
Credit unions aren't a new idea. Cooperative credit organizations were started in Germany in the mid-1800's with farmers pooling their money to buy supplies in large quantities at low prices. Excess earnings during good times were also pooled into a common account. This money was used for future purchases and for recovery in case of crop failure. Their foresight paid off. During poor harvests, individual farmers could borrow from the common savings at low interest rates.
Early cooperative efforts were managed by volunteers driven by a shared idea - to help working people build a better life. The founders believed that if they joined together in a cooperative spirit, they could solve problems of scarcity and high interest rates.
Credit unions spread quickly through Europe, and then to Canada. Edward Filene, a Boston merchant, introduced the idea to the United States in the early 1900's, combining money and knowledge to improve people's lives and financial security.
Credit unions have changed over the years to meet members' changing needs. Today there are over 11,000 credit unions chartered in the United States. In contrast to constantly merging banking institutions, credit unions are personal and people-oriented. They still believe in the principal:
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