Adrian Nichola
Active member
Credit unions works similar to banks. They both make loans, issue checks, do deposits, and ATM cards, and also provide investment services. But the big difference between banking institutions and credit unions has less to perform with the services they provide and more with how every institution is run.
Banks are for profit purposes. They earn cash by getting interest on loans, taking bank account charges and reinvesting all that money to make more profit.
Credit unions, aren't for profit purposes. Credit unions are owned or operated by their account holders, referred to as members. Any income received by a credit union is sometimes invested again into the company or paid back to members as a dividend. Credit unions don't pay state or federal taxes, which means they can charge lesser interest rates compared to banks for almost all financial services.
Banks are for profit purposes. They earn cash by getting interest on loans, taking bank account charges and reinvesting all that money to make more profit.
Credit unions, aren't for profit purposes. Credit unions are owned or operated by their account holders, referred to as members. Any income received by a credit union is sometimes invested again into the company or paid back to members as a dividend. Credit unions don't pay state or federal taxes, which means they can charge lesser interest rates compared to banks for almost all financial services.