Other financial institutions focus on money. From the start, credit unions have focused on people, dreams and results.
The difference between credit unions and other financial institutions is manifest in four key ways:
- How they define their purpose
- How credit unions are governed
- The benefits they offer their members
- The values they bring to their communities
To serve members
The most important responsibility of credit unions is promoting the financial success of their members. While maximizing profits for shareholders drives other financial institutions, credit unions are not-for-profit. The money they make does not pay dividends to stockholders. It is invested in members. This has been true through all of credit unions' history, including today.
Directors elected locally from among the membership
Credit unions have a unique structure: as co-ops whose boards of directors are elected by members. Decisions about the organization, direction, programs and policies that govern credit unions are driven by the benefits they provide to members: the people who are saving to buy a first home, finance a child's education or make a new car purchase. Credit union board members understand member needs and focus on ways to meet those needs. Conversely, other financial institutions answer to shareholders, so their bottom line is maximizing profits.
Earnings invested in the members and community
Money that is made by a credit union is invested in member benefits in the form of higher interest rates on savings and lower interest rates on loans. That means retirees have larger nest eggs and workers can afford to buy the home of their dreams. Viewed as unprofitable by other financial institutions, small businesses and self-employed individuals thrive with credit unions. Lower and middle income members are treated with the same consideration and respect as wealthier members. And through initiatives like REAL Solutions®, credit unions are reaching out to growing numbers of new Americans and those who can't get the financial help they need from other institutions. Credit unions not only offer better rates on savings and lower fees on loans, they also provide valuable information and free financial counseling - not to make a profit for the organization but to benefit members.
In people, not profits
Credit unions bring financial benefits to the community. By focusing their resources on helping members realize their financial goals and build secure futures, credit unions strengthen their communities. Moreover, because they are locally owned and managed, they are vested in and are committed to making significant contributions to the local area.
Taken together, these qualities add up to a single focus and a solid commitment to credit union members and to their financial success. Without that commitment, Wisconsin and its people would have fewer opportunities. More families would be frozen out of the housing market because they were unable to meet the profit demands of other financial institutions. More small businesses and self-employed individuals would be turned down for loans that would help them grow and prosper.
The 3 million individuals and their families who have joined a Wisconsin credit union have an ally that is dedicated to their financial future, whose expertise is available to help make their dreams realities and whose purpose is to advance members' interests. People who are simply account numbers and income streams at other financial institutions are the bottom line for credit unions.
The values of credit unions reflect the values of their members. That's good for hard working people who dream of a better future.That's good for people running small businesses that need a helping hand to reach their potential. That's good for communities when individuals and families are able to build a better quality of life.