Credit Unions vs. Banks
What are the Differences?
At Cove Federal Credit Union, we know that choices matter, and we understand that your choice of financial institution is an important one. A common question we hear from prospective members is, what are the differences between a credit union and a bank? Below, we’re sharing a few of those key differences.
Credit Unions are not-for-profit institutions. This means that profits aren’t being paid out to shareholders, as they are in banks. Instead, credit union earnings are used to increase the interest rates on our members’ deposits, and to decrease the rates on credit cards and loans made to members. View Loan Rates.
Credit Unions are owned and operated by members. While banks are corporations owned by shareholders, credit unions are owned by their members. Each member, regardless of how much money he or she has on deposit, gets a vote in electing board members who ultimately steer the credit union’s operations.
Credit Unions offer more flexibility and fewer complications. Banks tend to have strict credit score requirements for lending, and a variety of requirements for their accounts – such as “free” checking, as long as you make a certain number of purchases on your debit card each month or set up two direct deposits each month for the account. Credit unions offer more flexibility, and can often work with members who may not have a perfect financial past. Plus, the majority of our accounts are offered with no monthly fee, no minimum balance, and no minimum monthly deposit required. Learn more about Checking Accounts.
Credit Unions are more member-focused. An emphasis on excellent customer service allows our team to truly focus on helping our members achieve their financial goals. For our members’ convenience, at Cove we have a network of shared branches and ATMs that members can use with no fees.
Often, there’s a misconception that credit unions don’t offer as many products or services as a bank, or that they don’t offer as many tech-savvy options for managing your money. Cove offers a variety of checking, savings, and credit options, as well as personal and auto loans, and more. Plus, our members can manage their accounts and payments in our online portal, or with our mobile banking app ((include hyperlink to app page under e-services)). We’re proud to offer our members the best in credit union products and services, and our team is focused on working with members to build a healthy financial future for their families.