Chosing a Credit Union or a Bank

It is utterly surprising how many people don’t clearly see the difference between banks and credit unions. This question demands an immediate answer because it’s all about your money and in this article we’ll try to clear it up.

First difference starts with the structure.

In banks there is no system of membership, but they have shareholders who sometimes don’t even belong to the bank. In fact customers have no concept about the way the bank is run. Actually all the resolutions are made by a paid board of directors, and these decisions derive from best solutions for the little group of investors.

On the other hand, credit unions are democratic. You become a member or owner, once you make a deposit in it. A volunteer board of directors makes the decisions. These directors are elected by members or owners of the credit union. As a rule, decisions are made on what’s best for the people, because the same people make up the board.

Second difference is about bonuses.

Definitely, when a customer opens an account, sometimes their bank offers something like reward points, tablets or gift cards. Unlike credit unions banks are profit driven. Banks tempt you with bonuses, so you don’t focus much attention on moments when the interest rates or fees suddenly change.

At the same time credit unions offer nothing like that. But when costs are paid and the money they have to set apart is secured, the sum left is returned to members of credit unions in a great many different ways. Moreover, credit unions offer lower interest rates on loans and higher interest rates on savings and demand no fees! In the long run it’s really saving money! And definitely, you get a long list of benefits from your credit union.

Some people might adduce an argument that they don’t see credit unions in their neighbourhood as much as they see banks, and thus credit unions aren’t convenient. Credit unions are located in particular communities, but the benefit of this system is that all of them use ATMs network. Customers can encash from any credit union ATM that is part of The Exchange Network. There are a lot of these machines across Canada and you use it without any cost. All the same you do your banking or purchasing anywhere having a debit card and online / mobile banking.

Sometimes emergencies arise when you lack finances and need a student loan or a vehicle loan, or a loan to buy a home. You are granted the loan you want locally, not centrally inToronto. Your personality matters in this case and some details might be required before you are given an advance.

In case you want fast money, but you have a bad credit score, you might apply for payday loans, which is a fast financial assistance.

What matters more, credit unions have values. It’s about doing what’s best for the members, the employees and the community. Too unbelievable? Just try it and see!

Comments are closed.