When you’re trying to make the most of the money you make—for you and your family—your financial institution can make a difference in big and small ways. That’s why it’s a good idea to understand the difference between banks and credit unions. Continue reading
Understanding the Difference.
Banks are owned by their shareholders and are in business primary to return maximum profit to them through dividends and high share prices. Credit unions are owned by their members and return profits to them in the form of higher savings and checking interest rates, and lower mortgage rates, improved technology, and more.
Compare the products and services offered by a bank and a credit union and you really won’t find much difference. Checking accounts, savings accounts, mortgages and home equity lending, auto loans, student loan management, business banking—even insurance and financial planning—are available at either. And if you’re talking tech—global ATM networks, online and mobile banking, etc.—credit unions today are pretty much on par with banks.
Location, location, location.
With so much consolidation in the industry over the past couple of decades, fewer and fewer banks are locally owned, and might be headquartered many states away from you.
Credit Unions, on the other hand, remain by and large locally headquartered. That means business decisions such as mortgage and small business loan approvals are made with an eye on how they’ll affect the community long-term—not just the numbers.
The community connection.
Like any good business, banks and credit unions both believe in giving back to the communities they serve. With bigger banks, service initiatives often benefit national or regional organizations—which makes sense given their larger footprint.
Credit unions on the other hand typically extend service at a more local level—individual branches are often encouraged to organize activities to support organizations at the town or neighborhood level. At PenAir our focus is “Enhancing Lives” – that means the lives of our employees, our members, and our community. Learn about PenAir’s Communerosity program, and how you can get involved.
The choice between a bank and a credit union is always up to you. In the end, it’s about selecting the financial institution that does the most to help you and your family live better and achieve your goals.