Frequently Asked Questions

What is a credit union?

A credit union is a cooperative, not-for-profit financial institution organized to promote thrift and provide credit to members. It’s member-owned and controlled through a board of directors elected by the membership. The board serves on a volunteer basis and may hire a management team to run the credit union. They establish and revise policy, set dividend and loan rates, and direct certain operations. The result: members enjoy a safe, convenient place to save and borrow at reasonable rates from an institution that exists to benefit them, not to make a profit.

Who owns a credit union?

Unlike most financial institutions owned by stockholders, each credit union member owns one “share” of the organization. As a member, you’re not just a customer – you’re an owner entitled to vote on important issues, such as electing member representatives to serve on the board of directors.

How did credit unions start?

Credit union cooperatives began over a century ago in Germany. The movement reached the United States in 1909 when St. Mary’s Cooperative Credit Association, a church-affiliated credit union, opened in Manchester, New Hampshire. Today, one in every three Americans is a credit union member.

What is the purpose of a credit union?

Credit unions aim to encourage members to save money and offer loans to members of ordinary means. As nonprofit cooperatives, credit unions can often charge lower rates for loans and pay higher dividends on savings. Instead of paying profits to stockholders, credit unions return earnings to members through dividends or improved services.