Learn what a credit union is, how it differs from a bank, and why member
A credit union is a member-owned financial institution that provides deposit, payment, and lending services. Unlike a traditional shareholder-owned bank, a credit union is organized around its members, who are both customers and owners of the institution.
Credit unions accept deposits, make loans, and offer everyday financial services such as checking, savings, and cards. Because they are member-owned rather than run for outside shareholders, the economic model often emphasizes lower fees, competitive loan pricing, and member service. Membership usually depends on a defined field of membership such as employer, community, association, or other qualifying connection.
This matters because ownership structure affects incentives. A bank answers primarily to shareholders, while a credit union is designed to serve members directly. For consumers, that can influence rates, fees, customer experience, and the role of the institution in a local community.