Reaching Out to Credit Unions for Your Story
When seeking comment from a credit union official, you’ll first want to speak with the credit union president/CEO. At smaller credit unions, this person often holds the title of manager and may also serve in another capacity, such as treasurer. Credit union CEOs/managers can usually be reached at the credit union office.
CrossState Credit Union Association can provide reporters with mid-year and year-end statistics for credit unions in specific areas. New Jersey and Pennsylvania in their respective entireties, or on a national level. Credit union lists can be organized by asset size or membership size.
For more information, to arrange an interview with a credit union, or to speak with a credit union expert, contact the CrossState Credit Union Association’s Communications Department.
The Credit Union Difference
Are not-for-profit, member-owned credit unions really that different from banks? Yes, they are!
Because credit unions are a cooperative, not-for-profit financial institution, they typically can offer higher rates on savings and lower rates on loans than other financial institutions. Profits from a credit union go back to the members, primarily in the form of better rates and fees, as well as investments in service.
Each credit union serves a “field of membership,” which is something that all members have in common. It creates a common bond between the institution and its members. That’s why you’ll often see credit unions listed as sponsors for local youth sports teams, charitable 5Ks/fun runs, or golf fundraisers.
In fact, so strong are these bonds that credit unions are the only type of financial institution that is not open to the general public. Membership must meet common bond eligibility requirements in order to be approved, and these membership fields are broken into four simple categories:
- Employer: many employers provide credit union membership as an employee benefit
- Geographic Location: many credit unions serve members that live, work or attend school in a specific geographic area
- Family: many credit unions allow family members to join. In other words, if someone in your family is already a member, you can become one too.
- Membership in groups such as a church, a labor union, or another member-based association
The history of credit unions in the United States dates back to 1909, but really gained steam amid the financial crises surrounding the Great Depression. In 1934, President Franklin D. Roosevelt signed the Federal Credit Union Act into law. The law established a nationwide credit union system, overseen by the federal government, to help citizens with small incomes get credit for “provident purposes”— financial planning not just for now, but for the future. This helped stabilize the nature of the nation’s credit system and gave birth to the credit union’s mission, “People Helping People®;” an edict that still stands to this day.
Every single member of a credit union—whether they have one million dollars in their account or one hundred– owns an equal share of the institution he or she is a member of. This gives each individual an equal vote in electing a board of directors, making it a true and fully functional democracy.
Sources of Interest:
Credit Union National Association
National Credit Union Administration
Patrick Conway (ext. 2215)
President & CEO
Mike Wishnow (ext. 2213)
SVP, Marketing & Communications
Separating Fact from Fiction
Credit unions can serve anyone.
Fiction. Unlike banks, credit unions cannot serve the general public. Credit union membership is limited to persons who share a common bond of employment, association or community.
A credit union’s field of membership is restricted by law. The banking industry has been trying for years to deny consumers and employees of small businesses access to credit unions. At a time when banks are experiencing record-breaking profits, it’s evident that the prosperity of credit unions and their ability to serve millions of consumers has had no impact on a bank’s bottom line.
Credit unions do not pay taxes.
Fiction. Credit unions do, in fact, pay taxes. They pay property, county, school, municipal, and employer taxes. But, because credit unions are not-for-profit, returning all profits to their members in the form of higher rates on savings, lower loan rates and low- or no-fee services, they do not pay corporate income taxes.
On the contrary, banks must pay corporate income tax because they are in business to maximize profits and return them to stockholders, not customers. For that reason, banks are subject to the same income taxes as other for-profit businesses.
Credit unions look and act like banks.
True… to a degree. Credit unions offer financial services similar to those offered by banks. But credit unions, smallest to largest, subscribe to a business philosophy and retain a structure that is very different from banks.
Credit unions give consumers the option of owning the institution where they do their financial business. Therefore, credit union members are not just another customer– they have an equal vote in determining the direction taken by the institution. Credit unions cannot issue stock, and, most importantly, they return all earnings to their members.
Banks, on the other hand, are for-profit and have stock-holdings by outside investors, who essentially own them and hold voting rights. Banks exist to enrich stockholders, usually to the expense of their customers.
Credit unions don’t insure investments.
False. This could not be further from the truth. Credit unions have their own federal insurance program covering member savings accounts. Today, all credit union share accounts in Pennsylvania and New Jersey are insured up to $250,000 by the National Credit Union Share Insurance Fund (NCUSIF). The NCUSIF is administered by the National Credit Union Administration (NCUA).
No taxpayer monies, or monies from other federal deposit insurance programs, are used to fund the NCUSIF. Credit unions pay a percentage of their deposits to build the fund. And, like other financial service providers, credit unions are regulated and audited either by state or federal agencies.