How are Credit Unions different from Banks?

Since the first credit union in 1849, the credit union philosophy has always been: "People Helping People." Credit unions are member-owned, nonprofit financial cooperatives formed by a group of people with a common bond. At MCCU, our cooperative consists of people who live, work, or worship in thState of Michigan and in Ohio counties of Fulton, Lucas, and Wood.  Members of credit unions pool their assets to provide loans and other financial services to one another. Banks are for-profit institutions that are controlled by a board and stockholders who have varying amounts of influence over the bank's operations based on the total value of their shares. Customers of a bank who do not own stock in the company do not own a financial interest in the bank. Unlike banks, credit unions do not pay dividends to an outside group of stockholders and operate under a "one vote per member" system, regardless as to how much money the member has in the organization. A common misconception about credit unions is, because they are local financial institutions, their reach is limited. Credit unions bring the "People Helping People" philosophy to life by pooling resources and using networks such as the Co-Op ATM network to provide members with global access to their funds.

At a credit union, you are given the title of “member” and not “customer” because of the nature of your relationship with the institution. Because credit unions are member owned financial institutions, your initial deposit of $5.00 into a share account is your 'buy in' to the cooperative. This $5.00 share is often compared to minimum deposit requirements at a bank, which are usually somewhere between $50.00-$100.00, but they are very different from one another. Owning a share of a credit union gives you a vote at annual meetings and allows you to voice your opinion on who should sit on the board of directors, while opening deposit requirements at banks are imposed by their stockholders and do not give you a voice in how the business is run.

Another way credit unions live the "People Helping People" creed is by investing in the health (financial or otherwise) and well-being of their communities. For a look at some of the organizations Monroe Community Credit Union works with regularly, please visit our Community Involvement page!

"Banks use people to make money, credit unions use money to help people." - Bill Cheney, CUNA


Credit Unions                                                                                Banks      

Not for Profit

For Profit


Return earnings to members with lower loan rates, paying dividends on savings, and free or low-cost services


Return profits to shareholders


Management is responsible to the membership


Management is responsible to the shareholders


Members elect the board of directors

Stockholders elect the board of directors


Board members are volunteers, elected by the membership


Board members are generally compensated for their service


Members' funds on deposit are insured by the Federal Government through the NCUA for up to $250,000


Customers' funds on deposits are insured by the Federal Government through the FDIC for up to $250,000


Credit unions serve members who share a common bond, such as where they work, live, or worship


Banks can serve everyone in the general public



For more information on the differences between credit unions and banks, visit: or today!

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