Consumer Information:
What Is A Credit Union?

Not all financial institutions are alike . . .

. . . banks and savings & loans are financial institutions, chartered under state or federal law, that accept deposits and make loans for businesses and individuals in order to make a profit. Typically, they're owned and controlled by groups of stockholders whose interests include maximizing the return on their investment in the institution.

A Credit Union, on the other hand, is a not-for-profit cooperative financial institution. It is owned and controlled by all of the people who use its services. These people are members. Credit Unions exist to provide a safe, convenient place for members to save money and to get loans at reasonable rates. Like all cooperatives, they are based on the concept of "people helping people."  And  unlike banks any income that a credit union collects is distributed as dividends to its members or used to provide competitive rates to its members.

Credit Unions are closely regulated, just like other financial institutions. The National Credit Union Share Insurance Fund, administered by an agency of the federal government, insures the members' deposits at every Credit Union in Vermont and more than 10,000 Credit Unions nationwide. Your deposits are insured up to $100,000.

Why are Credit Unions so popular?

Credit Unions have been providing cooperative financial services for more than 150 years. Although they have grown tremendously in size and sophistication, they maintain the very same characteristics today that have made them so popular with consumers through the years:

The Credit Union mission is service, not profit . . . Credit Unions return profits, after expenses and reserves, to their members in the form of dividends and interest on deposits, low loan rates and improved services.

The members own and democratically control their Credit Union.

Credit Unions are dependent upon elected and appointed volunteers on the Board and various Committees. Their time and efforts amplify the "people helping people" philosophy of Credit Unions.

Members of Credit Unions share a common bond through employment, location, family and other factors. It unites the members and creates a greater feeling of responsibility since they are saving money together and making low cost loans to each other.