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Credit Unions vs. Banks

How are they different?

While banks and credit unions offer a lot of similar services, there are significant differences in the way they do business. Credit unions share a common mantra: "People helping people." Rather than maximizing profits, they focus on improving the financial well-being of their members. It's important to note that the credit union industry is strong and well-capitalized, making credit unions a safe place to do business.

How is RiverLand different?

We invest in our members - plain and simple. Some financial institutions take on more risk by investing their funds in ways that produce higher returns, increasing their profits. Instead, our primary source of income is the loans we generate for our members, which are carefully underwritten to ensure members are borrowing within their means. Our low-rate loans help members purchase vehicles, refinance their homes, pay off high-rate debt, and more. Essentially, we put our members' money to work for our members.

Here are several noteworthy differences between credit unions and banks.

Credit unions are not-for-profit financial cooperatives. Earnings are paid back to members in the form of higher savings rates, fewer fees, and lower loan rates. Banks are for-profit corporations. Declared earnings are paid to stockholders only. Banks usually have more and higher fees and less competitive interest rates.
Credit unions are member-owned. Each depositor is an owner of the credit union. Members vote for and get elected to the credit union board. Banks are stockholder-owned. Customers do not vote or have a say in how the bank is operated. Stockholders may or may not be customers of the bank.
Credit union board members serve voluntarily and reflect the diversity of the membership.  Bank stockholders are paid and do not necessarily reflect their customer base.
Credit unions are local and serve the interests of their membership. Affiliation, such as location or employer, is required to become a member. Banks are open to the general public and can serve anyone.
Credit unions share resources with other credit unions, such as ATM networks, to offer greater convenience to members.  Banks compete with each other and do not share resources. 
Credit unions member deposits are federally insured by the NCUA. Bank customer deposits are federally insured by the FDIC.


Additional Resources:

NCUA - Insurance Fund    Insurance Estimator     About RiverLand FCU

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