Credit Union Difference
The philosophy of "people helping people"
credit unions apart from other for-profit financial institutions.
Credit unions are dynamic full-service financial institutions with
sophisticated delivery systems - convenient branches, no-surcharge
ATMs, member contact centers and electronic delivery such as Online Banking. They
easily compare to banks in the types of products and services they
offer, but differ drastically in how they deliver these products and
services. Credit union members receive the outstanding value and service
While credit unions and banks offer similar products and
services such as checking accounts, credit cards, and mortgage loans,
there are still many differences among the two types of financial
member-owned financial cooperative. Makes decisions based on what is best for members. Each member is an equal owner of the credit union.
institution. Generates profits for a few stockholders. Makes decisions based on what will give stockholders more profit. If a customer doesn't
own bank stock, he or she is not an owner.
after reserve requirements are met are applied to lower interest
on loans, higher interest on savings or development of new products
and services that members have requested.
||Profits are paid to stockholders.
Each member has one vote in the election of the board of directors,
regardless of how much money they have deposited in the credit
stockholders vote for the board of directors, based upon the amount
of stock owned.
board of directors who are members of the credit union and users
of the credit union services.
||Board of directors are
paid. They may not be from the community and they may not even
use the bank’s services.
|Deposits are federally insured to at least $250,000 by the National
Credit Union Administration, a government agency. The NCUA's
insurance fund is one of the healthiest of all federal deposit
are federally insured to at least $250,000 by the FDIC, a government
Credit unions are good corporate citizens
Credit unions are located within the communities they serve and are dedicated to the well-being of their members.
Iowa credit unions, on the average, lend a higher
portion of their deposits compared to for-profit financial institutions.
As members of the local community, credit unions’
volunteer boards of directors are able to ensure that the best
interests of their communities are served.
Credit unions are only able to loan money to their
members — people who share a common bond within the credit
union’s field of membership. Credit unions’ high loan-to-deposit
ratios are a good indication of how involved they are within their
Credit unions do pay taxes
Contrary to what is often said about their tax structure,
credit unions do pay taxes.
Iowa’s state-chartered credit unions are
assessed a moneys and credits tax based on reserves. Additionally,
state-chartered credit unions pay sales, property and employer-related
Federally-chartered credit unions pay property
and employer-related taxes.
Congress and the Iowa Legislature tax credit unions
differently than banks because credit unions are not-for-profit,
member-owned cooperatives whose only mission is to serve members.
If banks truly believe credit unions are advantaged,
we welcome them to join the credit union community. However, banks
would have to become not-for-profit, require their boards of directors
to be volunteers and give each customer one vote in policy decisions
— regardless of how much money the individual has on deposit.