When it comes to money matters, it’s understandable that people only trust banks to handle their financial affairs since it has been a long-established industry. However, the long lines, costly interest rates, complicated loaning options, hidden fees, and less-than-ideal customer service make alternatives like credit unions more accessible financial institutions.
While credit unions offer the same banking services, the key difference is that it is not-for-profit, member-owned, and highly community-centric. Despite its progressive structure, its relative newness leaves more room for misconceptions to turn people off from exploring their credit options.
We’re here to bust common credit union myths so you can make the best choice for your future.
Myth #1: Credit Unions are Not Regulated and as High-Tech as Banks
Indeed, banks have always been the go-to choice way back in the 19th century, which means their assets are off the roof compared to credit unions. Nonetheless, this new form of a financial cooperative is proving to be just as innovative since it offers the same features as national banks, such as the following:
- Online payment options;
- Face and fingerprint recognition;
- Person to person payments;
- Instant account notifications;
- Mobile deposit;
- Mobile wallets;
The list above are just a few examples of what technology credit unions utilize, plus they follow the same standards as banks, making them equally regulated.
Myth #2: Credit Unions Doesn’t Offer High Loan Options
Credit unions may be a significantly smaller institution than conventional banks, but both federally insure your money up to a $250,000 cap. Credit unions also offer convenient services like checking and savings accounts, loans, mortgages, online banking, credit cards, investment opportunities, ATM cards, and even reward programs.
While you have to pay to join a bank’s reward program, the credit union is also built to give back to the community, so they build loyalty by providing rewards like symbiotic partnerships for redeeming points, cashback opportunities, higher return points, and lower fees.
Myth #3: Credit Union is for Local Banking Only
Credit unions are based locally, but they offer international online banking services that allow you to make transactions, deposits, and more across the world. Credit unions are also more cooperative than competitive; that’s why they offer shared branching in multiple states so you can access their services anywhere in your country.
The Bottom Line: The Truth About Credit Unions
There are plenty of misconceptions about credit unions, all of which promote fear-mongering that only prevents people from exploring their financial options. If you’re on the fence about making a switch to credit unions, the list above should bust some of the most concerning myths so you can make more informed decisions.
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Looking for the best community-based banking institutions that can help manage your finances in Buffalo, NY? Here at Good Neighbors Credit Union, we simplify your wealth management plans and help protect your investments, deposits, and other financial services.