Credit Union
By
Jonathan Boral on July 12, 2010
Credit Unions are financial organizations that run many of the same services as common banks. The big difference is that credit unions are run by the customers they serve, as they are the ones who are using the services as well as each owning a share of the company. Financially, they hold only a percentage of the assets normal banks carry. Credit Unions are also known as “not-for-profit” as they work to maximize customer services, not profit; although they do have to have a monetary stock so that they can run day to day operations and projects.
The basic structure of credit unions is based around their own customers creating the executive infrastructure. Each customer has a vote, and helps to elect the board of directors for the branch. Not only that, but volunteers can be elected to serve other functions as well. In turn, this elected board of directors is responsible for making many of the fiscal decisions for the branch, including what to set interest rates at.
Not only are credit unions unique through their infrastructure, but their services as well. Since the customers also have a stake in the well-being of the company, credit unions are known for spectacular customer service. They provide normal activities such as checking accounts, savings accounts, and
credit card applications, but also their customer services really provides one on one interaction between employees and customers. This helps these customers truly understand their banking along with the company they are investing in.
Not only are credit unions built around their customer support, but their relative small size and internal jurisdiction keeps them stable. For the most part, credit unions have been relatively unaffected by the
economic recession. Along with this, credit unions pay higher interest rates on customer assets, along with holding lower interest rates on loans than commercial banks. The only drawback is customers pay higher for certain services.
Overall, credit unions are a great opportunity for customers who are looking to get more knowledgeable about their banking uses, along with providing a great and stable opportunity for banking customers.