For most people, a credit union is just another bank. Whether they put their money from their job at the Edmonton cosmetic surgery clinic into the credit union or into a bank depends on the bank's interest rate, fee schedule, and convenience to work or home. Credit unions are a different thing altogether than a bank, however, and you should really know the difference before you make a decision on where to put your money. This article should help clear up the biggest misconceptions about credit unions.

Banks, such as the ones that have branches near every dental clinic in Scarborough, are first and foremost a business. They exist to make money for their owners in the form of interest that is taken in on the loans they grant to borrowers. By contrast, a credit union is a cooperative. A credit union is part owned by everyone who has money in it. Unlike banks, they are not for profit organizations that exist to help people secure loans and credit at competitive rates.

The biggest difference you're likely to notice about banking with a credit union is that you will have the opportunity to help select the board of directors, which means that you can actually exert some control over the bank's policies. With a regular bank, you are forced to accept whatever fees, investment decisions, and check 21 processors that the bank's ownership decides will benefit their bottom line the most. Even the interest rates at a credit union are set by its board, though they will usually follow the market like any other bank.

Because they are owned by their clients, credit unions often boast a higher level of customer service than privately owned banks. No one wants to set themselves extravagant fees for cashing the checks they receive through wedding catering in Hamilton or pay half of their dividends back to the bank in interest, so many of these factors will be more generous in a credit union. The bank does, however, have to have enough assets to allow it to lend money, so there are still likely to be some service fees to contend with.

If you're interested in helping your community to develop economically and in keeping assets local, than a credit union is a better choice for you than a regular bank. Credit unions lend micro loans that can help you make your house plans and invest in locally owned businesses. There are credit unions all over the world.