Credit unions are cooperative entities owners by members, and as a spokesman for the Credit Union National Association, or CUNA, Pat Keefe says, the mission of credit unions is to provide the members with more affordable financial services and not gouging them as profit centers. The mission of offering affordable financial services leads to satisfied customers. Prime Performance Bank and Credit Union Customer Satisfaction Survey has shown that credit unions are beating banks in all categories where customers have rated the overall satisfaction at 89%, which is seven points greater when compared to industry average.
Credit unions have lower fees and they pay higher rates. Customers are frustrated with bank fees and they may want to consider the options that are offered by credit unions. It is estimated that more that 96 million Americans use the services of credit unions, which offer higher savings rates and levy lower fees compared to traditional banks.
Often, credit unions are misunderstood as exclusive financial entities with limited services, but the actual sense is that unlike banks, these credit unions are governed by their members. On average, the credit unions offer lower interest rates on loans and also pay higher rates on savings. This is a set of things consumers are seeking from financial institutions.
For example, the National Credit Union Administration has reported that a five year car loan for a new car obtained from banks would attract an interest rate of about 5.19 percent. When this is compared to the 2.87 percent of the same kind of loan from credit unions, it means that the members of these credit unions enjoy better rates.
Although credit unions just like banks can collapse, the members are protected by the National Credit Union Administration, which says if federally insured credit unions fail, the members can receive payments for the deposits they have made within three days. This means that the consumers using the services of credit unions have their finances protected just like the banks.
In addition, the deposits made by the members are insured the same way as the banks. The federal National Credit Union Administration provides insurance for credit unions and offers the same protection as the bank’s Federal Deposit Insurance Corporation by providing up to $250,000 of insurance coverage on deposits. The higher saving rates offered by credit unions imply that consumers can get more from what they save.
Credit unions offer financial information to their members ensuring that they protect the interest of consumers while offering them the services they need. From these institutions, consumers can get information on different aspects such as managing credit cards and debts. As much as financial institutions want to make money, they also should ensure that they educate the customers not to get into traps of indebtedness and unsound financial debt management. This is important in order to keep the consumers financially healthy and be able to borrow more in future. Credit unions can help you when your financial debts are crippling you down by giving you resolutions to come out of debt.