Credit Unions vs. Banks

Year after year, research shows that consumer satisfaction is much higher with credit unions than with banks. When comparing the difference between credit unions and banks, it's easy to see why membership in a credit union just makes sense.

Here are some key differences between credit unions and banks:

Credit Unions Banks
Member Owned Publicly Owned
Serve only members In the business to make a profit.
Not for profit, not for charity, credit unions exist solely for service. Serve two groups: stock holders and customers
Focus solely on serving their members. Everyone who lives in San Diego or Riverside Counties can become a member of California Coast Credit Union. Banks can serve anyone in the general public.
As a not-for-profit, any income is returned to members in the form of low or no service fees, lower rates on loans and higher deposit rates. Only investors get a share of the profits.
Members elect a volunteer Board of Directors to represent their interests. Each member is an equal owner. Have a paid Board of Directors who represents the investors. Only investors have voting rights. Customers have no voting rights, and have no authority in the governance of the bank.
Deposits are federally insured by the National Credit Union Administration (NCUA) to at least $250,000 and backed by the full faith and credit of the United States Government. Deposits are federally insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC).
Like other not-for-profit institutions, credit unions are exempt from paying federal income tax. Credit unions do pay property and state taxes. Like other for-profit businesses, banks must pay taxes to the government.
Financial cooperatives. Members pool their savings to provide low-cost loans and low-fee services to each other. Commercial businesses. Banks offer services to make a profit.