Credit unions are known for being trusted and friendly, for offering good rates and for being on the side of the consumer. They’ve become increasingly popular among hardworking Americans over the years. Yet, our What Matters Now Research shows people still have a number of misconceptions about how credit unions operate and who they serve.
Myth: Credit unions have strict rules about who can join
Credit unions are locally-owned and may appear to only serve a certain institution or community. However, while there are some credit unions that limit eligibility, many have expanded their “common bond” of membership to be inclusive and help more consumers with financial services.
Some serve a geographic location, meaning you can join if you live within a certain distance of a branch.
Others have expanded their common bond to include individuals who support a social mission that is consistent with the credit union’s membership and values. For example, Pentagon Federal Credit Union—typically open to members of the armed services, civilian DoD employees and their families—also allows you to open an account with a one-time donation to Voice for America’s Troops or the National Military Family Association.
Chances are there’s a credit union out there for you. Search ASmarterChoice.org to find one that suits you!
Myth: Credit unions only exist to serve people of modest means
A myth among many consumers is that credit unions are designed only for people of modest means or with financial problems.
However, credit unions provide affordable services and products for people in the communities they serve, regardless of income. Their cooperative structure allows them to focus on meeting the needs of their members, not driving profit.
So, they’re able to help low- and moderate-income consumers with products such as pay-day alternative loans, non-prime auto loans, financial literacy counseling and more.
They also offer affordable services for more financially-secure members, like retirement and financial planning services, student loans, trusts, home equity and more.
Credit unions continue to innovate, develop technology and provide new solutions to meet the needs of all members, no matter where they are in their financial journey.
Myth: Credit unions are inconvenient
Because of their strong community focus, certain credit unions may only have branches or ATMs in the counties or states they serve. So, while you may not find your local credit union all over the country, that doesn’t mean you’ll have a hard time accessing your money.
Credit unions have joined forces to offer their members expanded services using shared branching. This means that if your credit union is part of the Co-Op Credit Unions Network, you can use any of the nearly 30,000 participating ATMs and over 5,000 shared branches, surcharge-free (this is double the amount of some national banks)!
Not only that, but nearly all credit unions offer mobile and online banking for their members. You can check your balance, transfer money, deposit a check, and even contact the branch from anywhere in the world, right from your computer or mobile device.
Myth: Credit unions aren’t as secure as banks
Did you know that nearly all credit unions are insured by the National Credit Union Administration (NCUA) up to at least $250,000? This is the same coverage that the Federal Deposit Insurance Corporation (FDIC) provides for banks.
In addition, they are held to strict state and federal regulations and guidelines to ensure that their members’ data is safeguarded and their funds are protected.
The NCUA’s website mycreditunion.gov is great resource to learn more about the security of credit unions and their commitment to members.
Know another myth? Add it to the comments below.
