There are many differences between banks and credit unions, and choosing one over the other depends on your personal circumstances. Banks have more branches, but credit unions are smaller and often limited in their geographic scope. This makes it difficult to find one when you’re out of town. Credit unions are also generally behind on technology. That means they may not offer mobile banking, online banking, mobile deposits, or fraud alerts.
While size does matter, it doesn’t necessarily translate into security or accessibility. While big banks have a nationwide network of branches and a nationwide network of surcharge-free ATMs, many credit unions don’t. And while some customers feel safe with big banks, credit unions don’t necessarily offer the same level of security. Bigger banks often have a larger selection of products and services.
Besides service, banks and credit unions have some major differences, too. Banks are for-profit institutions whose sole purpose is to deliver profit to shareholders. Moreover, consumers have no say in how their money is managed. Credit unions, on the other hand, are member-owned organizations and, as such, are more likely to offer better interest rates. If you have no particular affiliation, banks may be a better choice than credit unions.
Despite the differences between banks and credit unions, all banks have some significant advantages over their competitors. A credit union is a member-owned organization, so it has a higher focus on the local community and less on profits. While banks focus on maximizing profits, credit unions are dedicated to helping their members by offering lower fees and better interest rates. And they have more branches and ATMs than any other type of bank.
Another major difference between banks and credit unions is that they are not for-profit. Instead, they put their members’ financial well-being above everything else. While it’s hard to say if any credit union is better than any other bank, credit unions are generally better for you. The difference between banks and credit unions is striking. So, what are the advantages of a credit union?
Credit unions aim to build financial literacy. They provide education and resources to their members about how to budget and save. They also give employees a great place to work and a community-focused culture. While banks have their advantages, credit unions stand by their members. You’ll feel much better knowing they stand by their members and give back to the community. These are important reasons to make the switch.
Credit unions typically have lower costs than banks and can pass these savings on to their members. Moreover, they offer free checking accounts with no minimum balance restrictions. Banks, on the other hand, often charge high fees for low balances, overdraft protection, and non-sufficient funds. It’s worth considering all these differences and more. You’ll be glad you did. So, if you’re looking for a loan, a credit union may be the better choice.