The Difference Between Banks & Credit Unions
What makes a credit union different from a bank or savings & loan? Like banks, credit unions accept deposits and make loans – but that's where the similarities end. Unlike banks, credit unions are not in business to make a profit.
Banks and Savings & Loans are owned by groups of stockholders whose interests include earning a healthy return on their investments. Credit unions are not-for-profit financial cooperatives, owned and controlled by the people who use its services, called members. Any excess earnings are returned to members in the form of higher savings rates, lower loan rates, fewer fees, and expanded services.
Credit unions are unique in the world of financial institutions. While their purpose is to provide a safe, convenient place for members to save money and to get loans at reasonable rates, credit unions come in many shapes and sizes. Most offer low and no-cost savings and checking accounts and vehicle loans, as well as a full line of financial products including mortgages, credit cards, business loans, and electronic services including Internet banking. Some credit unions, including Randolph-Brooks, offer financial education training to help members become better-educated consumers of financial services.
Credit unions, like other financial institutions, are closely regulated. This credit union is federally insured by the National Credit Union Administration.