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I thought a credit union was a type of bank to serve a particular subset of people. What is the difference?Submited by:83 Ate Three

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1. raggdoll - March 12, 2010

With a credit union you get better returns, better interest rate, etc. A bank is more interested in making money for themselves than a credit union is. It’s usually easier to get a loan from “your” credit union, than it would at a bank, because you’re a member of “that” union. There are many types of credit unions but, yes they do cater to certain types of businesses. You don’t just open an account like a bank, you have to join the credit union to open an account with them. For instance, there are electronics credit unions, automotive credit unions, etc.

I hope this helped you !

2. charm_k - March 15, 2010

The key philosophy behind credit unions and banks is different. The banks run for the aim of generating profits while credit unions are community based institutions which run as non profit.

More details can be found in this article :

3. Mel M - March 15, 2010

I think Credit unions are financial institutions, like banks. They offer many of the same products and services — savings accounts, checking accounts, ATM/debit cards, credit cards, auto loans, mortgages, home equity loans, etc. Both have deposit insurance so your money will be safe. The main difference from your viewpoint as a consumer is that you can become a customer of any bank, while credit unions can only serve people who fit in their “Field of Membership.” Some credit unions are sponsored by a company and only the employees can join. There are numerous credit unions that have “community charters” which allow them to serve people who live within a defined geographic region (i.e. city, county, zip codes, etc.).

Most of the time credit unions offer better rates and have fewer fees than other financial institutions. Banks have more branch offices than credit unions.

Hope this helps. Good luck!