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 (called members) belong to the credit union and the credit union belongs to them.  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, or provide competitive rates for, 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 8,000 credit unions nationwide. Your deposits and Individual Retirement Accounts are insured up to $250,000.

Why are credit unions so popular?

Credit unions have been providing cooperative financial services to Vermonters for more than 60 years. Although they have grown tremendously in size and sophistication, they maintain the very same characteristics today that have always made them so popular with consumers:

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.

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.