Who Offers Lower Interest Rates? Credit Union or Banks?
What Makes Credit Unions Different from Banks?
1. Who is the owner of the credit union? For banks, the group of businessmen commonly called as investors are the said owners that are also greatly liable in creating rules and regulations surrounding the business. Because of this, the investors? capability of making money from their own investment in the bank is also being influenced. But in the case of credit unions, the members are also the owners themselves and that, they only have officials who just volunteered to make decisions for all the members. When it comes to certain policies, everyone has the right to vote and let his decision be recognized especially if it can affect his invested money.
2. Do you make sure that your money is safe? Any amount of money that is placed safe in the bank should be in the bank as assured by the Federal Deposit Insurance Corporation (FDIC) and you must see that policy in all banks. On the other hand, credit unions have Credit Union National Association (CUNA) as the group responsible in assuring that your money is kept safe under the union?s protection.
3. Who are the possible members? For as long as you meet up all the necessary criteria and personal documents, you can already be a member of a bank or a credit union. Banks need as many investors as possible for their bank to continue gaining and rolling money. It is but a fact that no matter how hard these banks try to gain investors and keep them, not all of them will be banking with them forever.
In credit unions on the other hand, you cannot be a member right away without passing through a precondition. You must first supply the necessary information regarding your geography, religion, civic affiliation and workplace. Credit union limits their membership for those who can really qualify to maintain a good quality of service for their customers.
4. Is the environment friendly? Banks would really want to have more members who would want to do banking with them but the reality is that, they care less about them. That is why you get to experience the best of them on the day that you open an account and would just slowly wipes out.
In the case of credit unions, even the customers have the power to make valuable decisions for the company they are member of. Credit unions set low interests on certain loans and credit cards for the benefit of their customers; they really made some ways in order for them to maintain the interest of the members that they have.
With the best offer with regards to interest rates and other beneficial services, credit unions became really popular. Because banks have larger reserved money, they could easily answer to the big demands of their respective customers. Choosing the right financial institution as your partner for life is a serious matter, you should choose wisely between the bank or credit union.
Credit unions are said to be less popular if we compare them to banks. Though credit unions are really not common, it doesn?t follow that they are also not good. Have a quick view on the different positive things about credit unions as we try to compare those to the most common and familiar banks.
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Source: http://financehelpnews.com/business-finance/who-offers-lower-interest-rates-credit-union-or-banks
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